Truworths International has secured an 88.9% stake in Office Retail Group in a deal worth £256m, the parties have announced.
The deal completed on 4 December and law firm Shoosmiths acted as advisers. The business has been acquired from investment funds advised by European private equity group, Silverfleet Capital, and the management of Office.
Management will reinvest a portion of their proceeds from the sale to retain an 11.1% shareholding in the business.
Truworths has the option to buy the shares owned by management in a three to five year period after the acquisition.
Truworths CEO Michael Mark said the acquisition provides Truworths with access to the UK and continental European retail markets, as well as the opportunity to diversify the group’s customer base and earnings.
Office is the leading young fashion footwear retailer in the UK and Ireland, trading under the Office brand and specialist brands Poste (men’s footwear), Poste Mistress (ladies footwear) and Offspring (sports footwear).
Office has 109 stores in the UK and the Republic of Ireland and 47 concessions in high profile retailers Selfridges, Topshop and House of Fraser. The business started its expansion into continental Europe in 2014 and currently has six stores in Germany.
It also operates a successful e-commerce business which now accounts for approximately 20% of sales. In the year to January 2015, Office generated sales of £270.2 million.
Following the acquisition, approximately 35% of the group’s revenue will be generated outside of South Africa, and approximately 54% will be generated from cash sales.
Shoosmiths corporate partner Kieran Toal, who acted on the deal, called it a “globally significant acquisition”.
“This has been a heavily partner-led transaction. Given this is Truworths’ first European acquisition and Office has such a large footprint, a number of our teams have been involved in working very hard to get this deal over the line. We wish Truworths every success in their investment in to Office,” he said.
Further reading: SEP backs Sportpursuit.com