Boohoo acquires all intellectual property rights of Debenhams in £55m deal
Following going into its second administration in April 2020 and subsequently into liquidation shortly before the festive period, Debenhams is one of the latest victims of the impact of the pandemic and the accelerated shift to online retailing.
Nevertheless, Boohoo, leading online fashion retailer, has recently announced its acquisition of all of Debenhams’ brands and intellectual property assets, including customer data, related business information and some selected contracts. This acquisition cost Boohoo £55million.
Debenhams’ website is one of the top 10 retail websites in the UK and receives around 300 million visits annually. The data which Boohoo will acquire from the brand will be key to facilitating the objective towards widening its scope and market offering into areas including beauty, homeware and sportswear, by providing valuable information as to who the target customers are at Debenhams, what goods they are buying and when, and other patterns in purchases. The acquisition will also be important for Boohoo as they will benefit from the existing Debenhams brand awareness, website traffic, and relationships with other third-party retailers and brands.
Boohoo’s executive chairman, Mahmud Kamani, has said the deal is ‘transformational’ and promotes their aim to become the ‘UK’s largest marketplace’. Such optimistic comments about the deal highlight the importance and value that intellectual property rights can have for a brand – in fact, it is estimated that up to 80% of the value in a business can be found in its intellectual property. This deal appears to accurately reflect such estimation, particularly as Boohoo has elected not to acquire any physical stores or stock belonging to Debenhams.
Intellectual property law is a complex area and depending on the products and services provided, a vast array of rights may be held automatically, or can be applied for to be registered. For business owners, it is always worth considering how to protect, and later exploit, the intellectual property rights that their business owns, as such rights can prove to be extremely valuable. Having appropriate registrations and arrangements in place not only reduces the risk of infringement, but also increases the likelihood of third-party investment and other opportunities.