The private equity owner of Jack Wills, BlueGem, is reportedly close to agreeing a sale of the business to Sports Direct’s Mike Ashley.
Following an alleged bidding war, Sports Direct International is now said to be the frontrunner to take a majority stake in the firm, Sky News reported.
Last week it was reported that Sports Direct and Edinburgh Woollen Mill Group, which is owned by Philip Day, were locked in a two-way bidding war for the business.
Drapers understands that it is likely to be structured as a pre-pack administration under Sports Direct ownership, while Edinburgh Woollen Mill has bid on a solvent basis for the company.
The bid deadline closed last week and a deal could be announced as soon as today.
It comes after Jack Wills appointed KPMG to carry out a review of the business and explore future opportunities last month. A spokeswoman said: ”In the meantime, management remains focused on its strategy of new product development, improving margins and driving cost efficiencies, which is already reaping benefits.”
An investment teaser, prepared by KPMG and seen by Drapers, was been sent out to the marketplace to coax bids. The document outlined an investment overview and potential opportunities for the new buyer. It stated: “The current investors believe the business can benefit from being part of a larger platform and would welcome the opportunity to retain a minority stake, which allows them to realise value from their investment to date.”
Jack Wills had a pre-tax loss of £29.3m on sales of £139.5m in the year to 31 January 2018. It currently has around 100 standalone stores across the UK, Ireland, the US, Hong Kong and Singapore.
Sports Direct has been contacted for comment, while and Edinburgh Woollen Mill, KPMG and Jack Wills have declined to comment.