Fashion retailer Boohoo Group has paid £55m to acquire the brand of Debenhams – the deal includes the brand name, in-house brands, intellectual property and customer lists. The agreement will eventually result in the closure of Debenhams’ 118 remaining stores as no physical retail locations were part of the agreement.

Debenhams are expected to relaunch on Boohoo’s web platform early next year. Until then Debenhams will continue to operate its website as normal.

The administrators of Debenhams UK, FRP Advisory, said they had undertaken a “thorough and robust process” to achieve “the best outcome for Debenhams’ stakeholders”.

“This transaction will allow a new Debenhams-branded business to emerge under strong new ownership, including an online operation and the opportunity to secure an international franchise network that will operate under licence using the Debenhams name,” they added.

Boohoo Group executive chairman, Mahmud Kamani, said: “This is a transformational deal for the group, which allows us to capture the fantastic opportunity as ecommerce continues to grow. Our ambition is to create the UK’s largest marketplace.

“Our acquisition of the Debenhams brand is strategically significant as it represents a huge step which accelerates our ambition to be a leader, not just in fashion ecommerce, but in new categories including beauty, sport and homeware.”

Emily Salter, Retail Analyst at GlobalData, commented; “In a surprising turn of events that proves the speed of the significant changes that the retail sector is undergoing, the boohoo group has acquired the intellectual property assets of Debenhams, raising the question of the relevance of traditional department stores in a post-pandemic environment. The group will relaunch Debenhams’ website as an online marketplace, with its expertise at operating digital pureplays providing some hope that the retailer’s fortunes could be turned around, benefitting from the shift to online shopping.

“However, there is strong competition from other online marketplaces, not least from leading force Amazon, but also from the likes of Next and ASOS, so the boohoo group will have to develop a more compelling branded offer for Debenhams for it to succeed. The acquisition of Debenhams also provides the group with a chance to expand its empire into new categories such as beauty, sports and homewares, likely translating into the launch of branded products in these sectors on its existing websites such as boohoo.com and PrettyLittleThing, helping them stand out in the crowded fast fashion market.”

Boohoo has previously bought Coast, Karen Millen and Oasis out of administration, but not the physical stores.