Wednesday, February 28, 2024

Vultures circle fashion and lifestyle website Very but owners refuse to budge on £4bn valuation

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Private equity sharks have been circling Very, but the owners’ £4billion valuation has made it difficult for a deal to be completed.

Funds have been approached about taking over the online fashion and lifestyle website, which had been gearing up for a public listing a couple of years ago, as the Barclay family looks to sell assets acquired over more than three decades.

But potential buyers have been deterred by its £4billion valuation with the family refusing to budge on the price tag, according to a report in The Times.

Some investors have also been repelled by the retailer’s high debt pile although some analysts believe ‘clever bankers’ may be able to devise an alternative exit route for the family.

It comes as the proposed takeover of the Barclays-owned Telegraph newspaper has raised questions about the future of its other assets. 

Designs: Very, fronted by actress Michelle Keegan, sells clothes, footwear, electronics, furniture and gifts

The company, fronted by actress Michelle Keegan, sells clothes, footwear, electronics, furniture and gifts and is based in Speke, Liverpool.

Susannah Streeter, head of markets at Hargreaves Lansdown, said: ‘Very has had real surge in operating costs and that’s exactly where a private equity firm would look to come in, restructure and strip out the high costs.’

The business had been planning to go public in the middle of 2023, with a valuation of up to £4billion touted. 

But since then, many firms have been put off by the London market due to a crash in tech stocks and difficulty accessing capital. 

Although Very enjoyed a boom in sales during the pandemic, this has faded in recent years.

Very’s profits slumped 92 per cent to £4.8million, from £63.9million, for its last financial year to July 2023, as it was whacked by higher operating costs.

And its ‘middle of the road’ position in the market means that it has struggled with weaker sales for its fashion and sports arms in recent months, Streeter added.

There has even been speculation that Very may fall into the hands of RedBird IMI, the Abu Dhabi-based investment firm buying the Telegraph and The Spectator magazine.

Redbird and Very both declined to comment yesterday.

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