Turkish retailer makes £1bn bid for troubled Asos

Laura Mcguire

A TURKISH retailer backed by Chinese ecommerce giant Alibaba has reportedly made a £1bn takeover bid for Asos.

Trendyol, an up-and-coming fast fashion retailer, is understood to have approached Asos in late December, when the brand was facing dwindling sales and operational changes, according to a report in The Sunday Times.

The reported deal would value Asos at between £10 and £12 a share, the report said.

The Turkish platform, which launched in 2010, is said to have been working with Morgan Stanley to make the offer, and has also approached one of Asos’s leading investors, Danish billionaire Anders Povlsen, to see if he would be interested in participating in the deal.

Asos was a success story during the pandemic, enticing bored consumers stuck at home to splash out on its clothing, tripling its half year profits to £106m in 2021.

At the height of its success, Asos also beat off a number of top bidders, including Mike Ashley for Philip Green’s crum- bling Arcadia empire, which included high street darling Topshop.

The £330m acquisition showed investors the power of not only Asos but also the digital shopping space as the future of brick-and-mortar retailers hung in the balance mid pandemic.

But fast forward two years and Asos has disappointed the markets through a series of unfavourable financial results – most recently a £75m cash call from investors to repair its balance sheet.

In the background, Jose Antonio Ramos Calamonte is spearheading efforts to turn the retailer around, who last year launched a “driving change” initiative to repair the group’s finances, which included reduced markdowns and new discipline on “marketing spend”.

But the market is yet to see the results of this turnaround plan, with Asos booted out of the FTSE 250 last week as its shares fell to a 12-month low.

Asos’s shares traded between £6.79 and £4.86 in December, but shares were at £3.50 when markets closed on Friday last week.

City A.M. has approached Asos and Trendyol for a comment on the bid.