Online fashion outfit Boohoo buys big slice of smaller rival PrettyLittleThing
Online fashion retailer Boohoo today bought a controlling stake in PrettyLittleThing, a smaller rival run by the son of its founder.
Boohoo will pay £3.3 million for a 66% slice of the business, whose recent campaign stars Lionel Richie’s model daughter Sofia, to bolster its presence in the UK and overseas.
PrettyLittleThing was founded by Boohoo co-chief Mahmud Kamani’s sons Adam and Umar. Umar is now chief executive. Revenue quintupled to £17 million in the year ending in February and it is expected to see sales growth of 150% this year.
Boohoo had the option to buy the entire group for £5 million under a March 2014 agreement, but said the 34% stake it didn’t buy would incentivise PrettyLittleThing bosses.
Boohoo also upgraded its full-year guidance after a strong Black Friday and start to the Christmas peak. It expects sales growth of between 38% and 42%, versus the previously guided 30% to 35% range.
Separately, Inditex, owner of fast-fashion giant Zara, reported a 11% rise in sales in the nine months to October 31 and a 9% rise in profits to €2.2 billion (£1.8 billion).