Boohoo completes £3.3m PLT deal

ONLINE fast fashion retailer boohoo.com has completed its purchase of a majority stake in Three Clothing Company Ltd, trading as PrettyLittleThing, for £3.3m.

The rival online fashion retailer was founded by the sons of boohoo boss Mahmud Kamani in 2012. The acquired 66% stake was bought pro rata to the March 2014 option agreement to buy the whole business for £5m, something drawn up when boohoo listed on the stock market as a solution to a potential conflict of interests.

The transaction was on a cash free debt free basis and the final consideration payable remains subject to the agreement of PrettyLittleThing’s completion accounts as at January 3, 2017.

The remaining 34% will be used to incentivise chief executive Umar Kamani and senior management and is subject to the management team remaining with the company for five years and achieving revenue and EBITDA targets.

In 2022, boohoo will have the option to acquire this remaining 34% at market value.

PrettyLittleThing, based in Ancoats, started out as an accessories only website, before introducing a clothing range in 2013.

It has enjoyed rapid growth in the two and a half years since then, with half year revenues hitting £19m to the end of August 2016 – an almost 200% increase on the previous half year.

Boohoo, which is based on Dale Street in the city centre and has its warehouse in Burnley, has said it will invest in PLT’s operations, including its warehousing, to further boost its performance.

Both fashion businesses specialises in the so-called ‘social generation’ – men and women under 25 – and boohoo now has around 4.5 million active customers across the world.

In a stock market statement confirming completion of the deal, the company said: “PrettyLittleThing is a fast growing, international online retail brand, which complements boohoo’s own inclusive and innovative brand.

“The board expects the transaction to extend the group’s presence in the UK and internationally and enhance the group’s strong growth trajectory.”

Investment bank GCA Altium and law firm TLT advised boohoo, while Zeus Capital acted as nominated adviser and broker. Pannone Corporate, led by partner Tim Hamilton and including Craig Geraghty, Brogan Pani and Jack Harrington, advised PrettyLittleThing on the deal.

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