Mike Ashley’s Frasers Group PLC (LSE:FRAS) has finalised the discounted acquisition of Matchesfashion, the luxury goods website.
The £52 million deal represents a significant loss for its private equity backer, Apax Partners, which is said to have invested as much as £600 million during its six years of ownership.
It will also involve the restructuring of around £20 million in debt owed by the seller of Gucci, Valentino and Burberry goods.
Next PLC (LSE:NXT) had also expressed interest in the deal but was ultimately outbid by the Sports Direct billionaire.
Matchesfashion, where customers can purchase coats for more than £8,000, has been loss-making for the past few years and posted an underlying loss of £33.5 million for the 12 months to 31 January 2023.
Nick Beighton, the former ASOS chief, took the helm last year after previous leaders had struggled.
Since Beighton took charge, the company improved its operational efficiency and enhanced marketing strategies but, like many retailers in the luxury goods sector, it was faced with a substantial decline in global luxury goods sales.
The takeover news comes only two days after Farfetch, the beleaguered UK-based but US-listed online luxury retailer was sold to South Korean e-commerce group Coupang in an eleventh-hour rescue deal.
However, like Apax Partners, Farfetch shareholders will not recover any value from their investments in the company once the US$500 million deal is finalised.