The troubled retailer Mothercare has struck a deal with UK pharmacy and health franchise Boots in a bid to save their fledgling business, which fell into administration last month after a difficult financial year. The child and baby company collapsed in November after failing to find a financial backer but will now remain on the British high street thanks to a buyout through Boots UK. With almost 2,500 stores across the United Kingdom and Northern Ireland and owned by the American health retailer giant Walgreens, Boots will now offer products from the Mothercare range both in-store and online, beginning the summer of 2020 after a long-term five-year deal is agreed by representatives from both companies.
Mothercare, which operated 1,600 stores around the UK and also sold items through its website, will shut down all of its independent UK operations by the summer of 2020 and only sell through Boots’ website and in its stores around the country. Fashion brands, home furnishings and items like car seats and prams will be available through the retailer, both under the Mothercare brand and its exclusive collections by designers like Jools Oliver. Mothercare and Boots are already collaborators on the children’s fashionwear line Mini Club, which is sold through Boots online and in-store.
In a statement, the CEO of Mothercare called the news of a deal ‘fantastic’ after what has been a ‘tough period’ for the company. Many hope that this will not only bring stability and certainty to the company but improve the fortunes of the fledgling brand in the new year.
Mothercare, one of the UK’s most popular baby and children’s brands, opened its doors in 1961 and was listed on the London Stock Exchange from 1972. Whilst it became a popular choice for mothers during its first few decades, it has struggled in the digital age to keep up with online retailers and supermarket alternatives, which often offer more clothing, furniture and baby necessities for a cheaper price.
Since the news of a potential deal broke, investors in Mothercare have seen their share price slowly start to increase after months of financial turmoil. It remains to be seen whether Mothercare will continue to float as an individual stock, or whether it will be absorbed into the Walgreens Boots Alliance, which currently only floats in the United States. Either way, investors will need to keep a close eye on developments for Mothercare, particularly going into 2020.