Boohoo rebrands as Debenhams – what it means for shoppers and investors

Boohoo bought the department store's name and website operations from administrators in 2021. Cork City. Pic: Larry Cummins

British online fashion retailer Boohoo has announced it is to rebrand itself as Debenhams Group after it acquired the department store chain’s name and website operations from administrators in 2021.

In April 2020, Debenhams Retail Ireland announced it was going into voluntary liquidation with the closure of its stores in Ireland. The move came after its British parent said it would no longer continue funding what already was an ailing business.

Staff impacted by the closures picketed outside stores seeking four weeks of redundancy per year of service and this lasted for more than a year.

However, on Tuesday, Boohoo announced that it was rebranding as Debenhams Group saying a “business review has confirmed that Debenhams, its business model and its technology is at the epicentre of our Group going forward”.

The company also named Phil Ellis as the new chief financial officer. Last October, Boohoo announced the departure of then chief executive John Lyttle, and appointed Dan Finley to replace him, and also unveiled a strategic review.

Since late 2024, Boohoo has faced a board dispute with its largest shareholder, Mike Ashley's Frasers Group. In January, Boohoo shareholders rejected Frasers' attempt to remove co-founder Mahmud Kamani from the board.

The two businessmen, Mr Ashley and Mr Kamani, have been rivals in the past, notably when Frasers failed to rescue department store chain Debenhams, in which Ashley previously held a stake.

On Tuesday Boohoo said that Debenhams is growing rapidly, the business model is stock-lite and capital-lite, it is very profitable and highly cash generative.

Boohoo added that it sees a clear path to Debenhams becoming a business in the medium term with multi-billion pound gross merchandise value and a core earnings margin on net sales of about 20%.

Mr Ellis, the current finance director of Debenhams and managing director of DebenhamsPay+, will become group CFO and a member of the board, replacing Stephen Morana with immediate effect, Boohoo said on Tuesday.

Boohoo, once boosted by the pandemic's online shopping surge, now faces supply chain issues, rising returns, weak consumer demand, and tough competition from Shein and Temu - all of which are impacting its profits.

Reuters