Next PLC (LSE:NXT) and the Reiss family have agreed to buy Warburg Pincus' 34% interest in Reiss for £128 million.
The deal, which is expected to complete in mid-October, will see Next's holding in the Reiss business increase from 51% to 72%, while the Reiss family's interest will rise to 22%. The Reiss management team will have a 6% stake in the business.
The acquisition will not materially impact Next's underlying pre-tax profit or EPS in the current year, the retailer said, although there will be a non-recurring, non-cash, exceptional gain reflecting the increased value of its investment in Reiss.
Next said it would provide further details alongside half-year results in September.
Following completion of this transaction, Reiss's results will be consolidated into the Next accounts.
In the year to 28 January 2023, Reiss achieved total sales of £324.6 million, an increase of 26.4% on the prior year. Profit before tax in the same period was £51.6million, an increase of 50.5% on the prior year.
Shares in Next were 0.3% higher in mid-morning trade on Friday.