SYDNEY: Noni B Limited and Alceon Group have reached agreement for Noni B to acquire a 50.1% equity interest in EziBuy Limited from Alceon for a nominal consideration.
Noni B will have economic ownership from 28 October 2019, and will have a call option to acquire the remaining 49.9% equity interest on or prior to 31 December 2020 for a consideration of A$11 million in cash.
Noni B Limited Managing Director and CEO, Scott Evans, said: “This will be another exciting step forward for the Group, consolidating our position as one of Australia’s leading apparel retailers. 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.
“The terms of the transaction are very attractive for our Group and we are confident it will be highly value accretive to Noni B. We have a successful record of acquiring retail businesses and improving their operational performance. It is complementary to our existing portfolio of brands, offering cross-selling opportunities, new category growth and geographical expansion for both businesses.
“EziBuy is one of the largest multi-channel retailers in Australia and New Zealand, generating approximately NZ$135 million of revenue, of which over 80% is through its digital platform. It houses expertise in digital and catalogue retailing which we can leverage in a meaningful way across our broader portfolio.”
EziBuy delivered normalised EBITDA (excluding non-recurring costs) of NZ$0.4 million for FY2019. Management anticipates cost of doing business synergies of approximately $9 million to be fully realised in FY21, with additional upside anticipated from leveraging Noni B’s sourcing scale and capabilities.
Commenting on the potential for EziBuy, Mr Evans noted: “We are excited about the potential growth offered by the EziBuy acquisition and look forward to continued revenue and earnings growth in FY2021 and beyond.”