The company said the ongoing discussions are about snapping up Arcadia’s brands.
Asos said in a short statement to the London Stock Exchange: “The board believes this would represent a compelling opportunity to acquire strong brands that resonate well with its customer base.
“However, at this stage, there can be no certainty of a transaction and Asos will keep shareholders updated as appropriate. Any acquisition would be funded from cash reserves.”
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The firm, whose name stands for As Seen On Screen, does not have a high street presence, so any deal is unlikely to include saving the Arcadia stores, which could close for good, leaving the brands trading online only.
Confirmation of the discussions comes just days after high street stalwart Next said it was pulling out of discussions around a possible bid alongside US hedge fund Davidson Kempner as it was “unable to meet the price expectations of the vendor”.
Arcadia, which employed some 13,000 people across more than 400 UK stores, collapsed at the start of December due to the impact of the coronavirus pandemic, years of under-investment and a failure to keep up with shifts to online shopping.
Other retailers including Boohoo, Mike Ashley’s Frasers Group and JD Sports in partnership with US retail giant Authentic Brands were also said to have been considering acquiring some or all of Arcadia’s stores.