Saudi Arabia-based franchise operator Fawaz Abdulaziz Alhokair Co (Alhokair), and Arabian Centres Company (ACC), the leading owner, developer and operator of lifestyle shopping centres in Saudi Arabia, (Buyers) have announced that they will acquire a combined 51% stake in Vogacloset, a UK-based online fast fashion platform offering over 400 brands in the latest women’s, men’s and kids’ trends to fashion enthusiasts in the Middle East.
Buyers will acquire 41.2% of the existing shares of Vogacloset based on an assessment of $60 million, subject to a structure of contingent gains at certain growth thresholds. In addition, $12 million will be injected into the capital of Vogacloset to further develop its presence in the Saudi market, accelerate the growth of its active customer base and support the integration of Alhokair brands and ACC tenant brands onto the e-commerce platform. Post transaction, Alhokair and ACC will own a combined 51% stake in Vogacloset.
It is envisaged that Vogacloset will be integrated with a Joint Venture (JV) established by the buyers to support the development of future opportunities aimed at building the two leading Saudi retail players’ omnichannel experience, for consumers and merchants alike. Plans already in the pipeline include the launch of a loyalty programme, along with a consumer finance offering.
“Our investment in an online fashion and beauty platform of Vogacloset’s calibre is a significant milestone in our transformation and represents an exciting opportunity. This strategic investment in a sizeable and profitable regional e-commerce player is the most direct route for Alhokair to extend its leadership position in its core Saudi market – from offline to the online space, while safeguarding our competitive market position,” says Marwan Moukarzel, CEO of Alhokair.
“We remain committed to our digital integration programme and transition to a lifestyle retailer of choice. Through Vogacloset’s platform, we look forward to introducing a range of brands online that is unmatched in the Saudi retail space, addressing our growing customer demand for a genuinely omnichannel experience, and giving our brands extended reach,” adds Moukarzel.
“In line with our ambition to create Saudi Arabia’s first specialised digital retail platform, the partnership with Vogacloset will greatly enhance convenience and engagement for tenants and customers. The JV will add value to ACC by enabling us to offer a more holistic proposition for all our mall tenants, by giving their brands an improved online presence,” commented Faisal Al Jedaie, CEO of ACC.
“Partnering with Alhokair and ACC in Saudi Arabia, our key market, is a strategic leap for Vogacloset. We have built a leading multi-brand fast fashion platform with a successful track record of meeting evolving consumer demands across the Middle East, supported by close alignment and tight integration with our highly-reputed and well-established European online fast fashion suppliers. This partnership, and the new investment that it will bring, will support and accelerate the execution of our very ambitious growth plans in Saudi Arabia and the Middle East, says Hanin Hamarneh, CEO of Vogacloset.
The transaction is subject to compliance with a number of prerequisites and is expected to complete by the end of June 2021.
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