It's no longer a rumor. The private equity firm Leonard Green & Partners has invested $250 million for a 25 percent stake in Topshop and that appears to be just what the British fast-fashion chain needs to ramp up its expansion in America.
According to a piece on CNBC, Stacey Widlitz, president of SW Retail Advisors, says the deal should raise concern for fashion chains including Abercrombie & Fitch, Aeropostale, American Eagle, The Gap and Urban Outfitters.
Currently, Topshop has flagships in Chicago, Las Vegas and New York with another planned for Los Angeles in Spring 2013. It also operates store-within-the-store selling spaces in 14 Nordstrom locations across the U.S. It also has an online presence with its us.topshop.com and us.topman.com e-commerce sites.
Leonard Green & Partners is well known for taking stakes in retailers including BJ's Wholesale Club, David's Bridal, J. Crew, Jo-Ann Stores, Neiman Marcus, Petco, Rite Aid, The Container Store, The Sports Authority, Whole Foods and others.
Honor Westnedge, an analyst at Verdict Research, suggests that in light of Leonard Green's investment in Topshop, she doesn't expect the chain to have the same difficulties navigating the U.S. market as other imports. She told Bloomberg News, the private equity firm has "a lot of experience of the U.S., they know the customer, the areas they should have a presence."
Which of the following apparel chains do you think is most at risk from Topshop expanding its presence in the U.S.?