Next in talks over £500m Reiss sale

Next is reportedly in talks over a potential sale of fashion chain Reiss, which it currently controls with a 51% stake, in a deal that could value it at over £500m.

According to Sky News, Next, alongside fellow Reiss shareholder Warburg Pincus, have entered talks with bankers regarding an auction of the fashion chain. 

Sources told Sky that the auction was in its second round and that a “number” of potential buyers were interested in acquiring the business. 

They added that based on expected earnings before interest, tax, depreciation and amortisation of almost £65m this financial year, Reiss could be valued at over £500m.

A source close to Next said there was doubt over whether it would ultimately sell its 51% stake, however, while another source suggested it may be using the auction process to establish a market price, and then acquire Warburg Pincus’s remaining stake.

Investment bank Raymond James is reportedly overseeing the sale process, and is understood to be soliciting offers for the entirety of Reiss’s share capital, although a source told Sky that Next could opt to retain its 51% stake alongside a new equity investor.

Last August, Next upped its stake in Reiss to 51%, having previously acquired a 25% equity stake in Reiss back in March 2021, which was valued at around £200m, as part of a long-term, “strategic” partnership.

Next has been contacted for comment.