British retail group Next is reportedly considering a rescue bid for struggling fashion brand LK Bennett as the heritage label prepares to file for administration, industry sources say. The potential move reflects growing consolidation interest in the UK apparel sector, with established retailers seeking to acquire distressed brands and intellectual property assets at discounted valuations.
According to sources familiar with the discussions, Next is weighing a “cut-price offer” for LK Bennett’s brand and other intellectual property assets as the company readies itself for administrator intervention. The potential bid reportedly does not include an interest in the brand’s limited physical retail estate, which has contracted significantly in recent years.
LK Bennett, founded in London in 1990, once operated a global network of approximately 200 stores and was synonymous with accessible luxury womenswear, often worn by high-profile figures including the Princess of Wales. However, the brand has faced mounting financial pressure in the face of evolving consumer preferences, rising costs and a challenging retail environment.
In its latest financial statements for the year ended 27 January 2024, the company reported a post-tax loss of approximately US $ 4.4 million on turnover of around US $ 53.5 million, marking a decline from previous years, according to industry reports. The accounts also showed that LK Bennett carried borrowings of close to US $ 28 million, raising concerns over its ability to meet financial obligations without fresh strategic investment or a broader restructuring.
The brand’s current owner, Byland UK, acquired the business out of administration in 2019, when it was rescued by its Chinese franchise partner. Since then, LK Bennett’s footprint has shrunk, with just nine standalone stores and around 13 concessions listed in the UK and Ireland.
Retail analysts say that a rescue bid from Next would align with the FTSE 100 retailer’s strategy of acquiring and integrating distressed fashion labels. In recent years, Next has completed acquisitions of Seraphine, the maternitywear brand, and Cath Kidston, and has expanded its portfolio through wholesale and online platforms.
Other potential bidders are also understood to be monitoring the situation, including Marks & Spencer and TFG London, which owns brands such as White Stuff and Phase Eight. Industry observers say interest reflects the enduring value of established fashion brands, even as retail conditions remain pressured by subdued consumer spending and digital-first competition.
If a deal with a new investor or buyer does not materialise, LK Bennett is expected to enter formal administration, marking its second insolvency process in six years. The outcome will be closely watched across the textiles and apparel sector, as it underscores broader challenges facing mid-market fashion labels in a rapidly evolving UK and global retail landscape.
