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Wesfarmers to acquire Catch
Posted on Thursday, 13 June 2019 06:52
Wesfarmers is buying online retailer Catch Group Holdings for AUD 230.00 million (USD 160.01 million) in cash.

The acquisition remains subject to certain conditions, including approval by the Australian Competition and Consumer Commission merger clearance, which is expected in the upcoming months.

Wesfarmers will fund the deal from existing debt facilities.

Founded in 2006, Australia-based Catch operates an online marketplace which offers branded products such as clothing, footwear and sporting goods.

Rob Scott, managing director of Wesfarmers, said: “This acquisition represents an opportunity to accelerate Wesfarmers and Kmart Group’s digital and e-commerce capabilities whilst continuing to invest in the unique customer and supplier proposition provided by Catch.”

Upon closing, the target will continue to operate as an independent business unit, overseen by the managing director of Kmart, Ian Bailey.

The deal will help increase Wesfarmers’ online footprint for its retail units, including Kmart and Target, as customers increasingly move towards internet-based shopping.

Established in 1914, the acquiror is one of Australia’s largest-listed companies which operates a diverse portfolio such as home improvement, outdoor living, office supplies and general merchandise.

Wesfarmers has over 220,000 employees at brands include Bunnings Warehouse and Officeworks.

For the six months ended 31st December 2018, the group posted revenue of AUD 14.39 billion, up 4.2 per cent from AUD 13.81 billion in the corresponding period of 2017.

Ian Bailey said: “This [the acquisition] will further drive best practice in supply chain, fulfilment and online execution across our brands, including opportunities for Target to secure online fulfilment capacity and productivity benefits.

“Catch will also benefit from the support of Kmart’s scale and capabilities to drive its continued growth in its existing marketplace business.”

According to Zephyr, the M&A database published by Bureau van Dijk, there have been 179 deals targeting electronic shopping and mail-order houses operators announced worldwide since the beginning of 2019.

In the largest of these, US-based Mercadolibre raised USD 1.15 billion through a public offering of common shares.

© Zephus Ltd