// Asos suppliers sever ties with the business as its credit insurers remove cover
// Last week the retailer was relegated from the FTSE 250 index
Asos’ suppliers have begun cutting ties with the embattled online fashion retailer after credit insurers withdrew cover amid concerns over its falling profits.
“Lots of suppliers aren’t delivering as insurance has been lost,” one supplier told The Times.
Allianz Trade withdrew cover entirely for Asos suppliers last month, citing adverse economic conditions and the retailer’s finances. Fellow insurer Atradius has also reduced cover.
Another supplier said he had stopped supplying Asos and “and we won’t supply them again until they get credit insurance backing”.
Another supplier to Topshop and Topman, which Asos bought in 2021, has been asked to produce Asos own-brand product but has declined due to the lack of insurance.
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The retailer, which was valued at over £7bn just more than 2 years ago, was relegated from the FTSE 250 index last week, signifying the decline in its fortunes in recent years.
This weekend news emerged that Asos had received a £1bn approach from Turkish online retailer Trendyol, which is backed by Chinese giant Alibaba, late last year.
The deal would have valued the etailer at between £10 and £12 a share, substantially higher than the £3.50 they are now valued at.
Trendyol is understood to have been working with Morgan Stanley on the bid, according to The Sunday Times, however there are no talks underway currently.
While this week, Frasers Group upped its stake in Asos as the online retailer continues to struggle.
The Mike Ashley-owner retail group has increased its stake from 7.4% to 8.8%. This is up from 5% in October last year.
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