Kiddicare set to be acquired out of administration
NURSERY brand Kiddicare is set to be bought out of administration along with its owners by furniture giant Dunelm.
The Dunelm Group, through its subsidiary Globe Online, has acquired the entire WS Group for £8.5m.
The group consists of Kiddicare, formerly owned by Morrisons, members-only online store Achica, and Worldstores Ltd. Worldstores was established in 2008 by founders Richard Tucker and Joe Murray. The group now returns revenues of £100m and has around 650 employees.
The acquisition is subject to each of the companies in the WS Group being placed into administration.
The company expects to acquire the WS Group businesses later today from the intended administrators, William Wright and Robert Croxen of KPMG. WS Group management, including the founders, will continue to run the WS Group and will be “appropriately incentivised”.
Kiddicare has changed hands twice following its sale by Morrisons. It was first acquired by Endless in July 2014, and two months later Worldstores bought the business.
Dunelm said the acquisition will increase its furniture range and provide a new technology platform. It plans to invest £15m in the WS Group to fund historic working capital and to manage disruption for suppliers and customers, as well as an additional £3m in transaction costs.
It expects to benefit to the tune of £10m a year in the medium term from the acquisition, but said that during its first year, ending in July 2017,it will incur losses of between £5m and £10m. It expects WS Group to break even the following year.
John Browett, chief executive of Dunelm, commented: “We are excited by this opportunity to accelerate the growth of our internet operation, more than doubling its size, and enhancing our position as the destination Homewares retailer in the UK, both online and offline.
“Between the store network, broad product range and strong brand that Dunelm has built and Worldstores’ extensive homewares and furniture offer and unique platform for next day delivery and flash sales, we will strengthen our leading position as the UK’s Home of Homes.”
Richard Tucker and Joe Murray, Worldstores’ founders, commented: “We’re delighted to be working with Dunelm, in whom we have found a partner who shares our vision for our company and brands, and is backing our ambitious plans for growth.”
