Babywear equity deal advised by Clearwater
THE SALE by JoJo Maman Bebe of an equity stake in the maternity and babywear retailer was advised by Clearwater Corporate Finance’s Birmingham based consumer team.
The team helped the business’s founder Laura Tenison secure an equity investment for a minority stake in the business from funds owned by7 New Look founder Tom Singh, who was advised by Magenta Partners.
JoJo Maman Bébé has seen a 50% increase in sales from £18 million to £27 million in the two years from July 2009 to June 2011. Pre-tax profits have increased from 4% in the year ending 2009 to a forecast of 8% for year ending June 2011. There has also been a 33% increase in headcount, with the business now employing 350 people, up from 241 in June 2009.
Clearwater worked with Laura Tenison to source the equity backer for JoJo Maman Bébé and structured the deal with Magenta, whose principal founder investors are the Singh Family Trusts. Tom Singh, founder of New Look, is one of the UK’s leading retail entrepreneurs.
Gareth Iley, director at Clearwater, said: “We had long been admirers of Laura Tenison and the way in which she and the management team at JoJo Maman Bébé have developed such a successful multi-channel retail model.
“Laura has now found the right investor that will provide growth capital to the business, and Magenta will work alongside her to strengthen the management team and grow the business. This deal is testament to the faith that private equity investors continue to show in the consumer sector for businesses with a strong proposition and brand, and adds to our experience of advising entrepreneurs on these specialist transactions.”
Ms Tenison said: “This is a unique business founded on a strict moral and ethical code of conduct. We have traded well throughout the economic downturn with positive LFL figures. Despite being courted by equity funds for many years, we have only now found our ideal financial investor who rates these core brand values.
“We are delighted to be working with Magenta to grow the business in a sustainable manner, and to open up new opportunities that were out of the reach of our organic growth plan.”
Chase Emson, partner of Magenta, who joins the board of JoJo Maman Bébé, added: “We intend to work with the management team to help expand the business in the UK and capitalise on international growth opportunities. Our extensive experience within the retail sector will enable us to bring incremental value to this already successful business.”
A team at Squire Sanders Hammonds provided legal advice to JoJo Maman Bébé.
