Zeus has advised listed fast fashion giant boohoo on its acquisition of the remaining 34 per cent of shares in Pretty Little Thing (PLT) for an initial consideration of £269.8m which could potentially rise to £323.8m dependent on share price performance. The acquisition is expected to be significantly earnings enhancing on a fully diluted basis with immediate effect.
Founded in Manchester in 2006, boohoo is an inclusive and innovative fashion e-commerce brand targeting young, value-orientated customers. Since completing a £550m IPO in 2014, again led by Zeus, boohoo has grown rapidly in the UK and internationally, with a current market capitalisation in excess of £4.5bn.
By acquiring the remaining 34% stake in PLT today, the Group is taking an important further step towards achieving its vision to lead the fashion e-commerce market globally by accelerating full ownership of a brand that is in high growth with enormous growth potential ahead of it, in a transaction that creates significant value for the Group’s shareholders. After this acquisition and with its growing platform of wholly owned, innovative fashion brands, the Group believes it can continue to successfully disrupt the international markets it operates in today, whilst retaining a strong balance sheet in order to take advantage of numerous M&A opportunities that are likely to emerge in the global fashion industry over the coming months.
Since the group acquired its initial 66 per cent stake in PLT in January 2017, the brand has benefitted significantly from the enlarged group’s multi-brand platform. Net sales have soared in the three years since – from £55m in the year ending 28 February 2017 to £516m in latest financial year, which represents a CAGR of 111% in this timeframe. In the last financial year, PLT’s adjusted after tax profit totalled £47.2 million.
PLT’s senior management team – Umar Kamani and Paul Papworth – will remain in their current roles and will continue focusing on developing PLT into a global fashion brand.
The team at Zeus, comprising of Nick Cowles, Benjamin Robertson, Andrew Jones and Josh Bean acted as adviser on the transaction.