Australian retailer Noni B (ASX: NBL) and Alceon Group have reached an agreement to purchase a 50.1% stake in EziBuy, a large multi-channel clothing and homewares retailer in New Zealand for an undisclosed “nominal” figure.
The purchase will provide Noni B and Alceon with the majority stake in EziBuy which last year reported NZD $135m in sales revenue for $400,000 EBITDA. Key to the transaction is access to EziBuy’s database of more than 2 million customers with the majority based in New Zealand.
Noni B expects the acquisition to add $200m in online sales to the Australian retail Group.
“This will be another exciting step forward for the Group, consolidating our position as one of Australia’s leading apparel retailers,” said Noni B Ltd CEO, Scott Evans.
“It will provide a low-risk opportunity to fast-track our digital strategy, increasing our digital income to c. 20% of the combined Group’s revenue.”
“EziBuy is one of the largest multi-channel retailers in Australia and New Zealand, generating approximately NZ$135m of revenue, of which over 80% is through its digital platform.”
Operating the brands Millers, Rockmans, Noni B, Rivers and Katies, amongst others, access to the large EziBuy database of online customers will deliver cross-selling opportunities between brands with Noni B to take over day-to-day management of EziBuy following shareholder approval of the purchase.
Attached to the acquisition of the 50.1% stake, is an option for Noni B to take over the remaining 49.9% at any time before 31 December 2021 with an exercise price of $11m in cash.
For FY19, Noni B Limited reported a 22% EBITDA increase to $45.5m from total group revenues of $881.9m. The Company expects $9m in shared business synergies from the EziBuy acquisition to be fully realised in FY21.