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Highlights
- The Barclay brothers, owners of The Very Group, appointed UBS, Barclays, and Morgan Stanley investments banks for coordinating and managing the IPO.
- The Very Group is all set to make its debut in the London Stock Exchange in 2022.
- In July 2021, The Very Group raised £575 million in funding via bond issue to aid in the extension of refinancing debts.
The Barclay Brothers, owners of the fashion retailer The Very Group have selected a trio of investments banks – UBS (LON:OR3T), Barclays (LON: BARC), and Morgan Stanley (LON:0QYU), as the official co-ordinators of the £4 billion IPO launch. The online retail group is slated to make its debut on the London Stock Exchange in 2022.
The selected investment banks will be engaged in coordinating and managing the fashion retail group’s IPO launch. The investment banking firms will be responsible for creating a prospectus that offers details of the company such as stock offerings and manage necessary legal and compliance issues with the financial regulatory bodies.
£575 million funding to refinance debts
The Very Group is owned by the Barclay family for about 20 years and the news of them selecting the 3 investment banks for the IPO floatation comes just days after The Very Group, owner of online retailers Very and Littlewoods, raised a £575 million funding via bond issue to aid in refinancing debts.
The bonds are rated B3 stable by Moody’s, a risk assessment firm, and thus attracted tremendous investor attention, with an order book value of over £950 million. The gross funding proceeds along with the cash on its balance sheet will be used to fully redeem the issuer’s £550 million principal amount of 7.75 per cent senior secured bonds due for expiry in 2022, and pay the costs fees and expenses associated with the transaction.
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In the earlier review of The Very Group’s ownership structure, the Barclay brothers did not hire any advisory firm to review the ownership structure. It was the first time, in July 2021 that the owners of the fashion retail company appointed STJ Advisors to explore ownership options for The Very Group. The advisory firm works alongside companies ahead of their public listings.
The Very Group listing on the London Stock Exchange’s junior AIM market would be the most ideal scenario for the online fashion retailer. The successful listing of The Very Group on the stock market will make it the first flagship business of the Barclays brothers to have applied and qualified for an IPO.
Financial performance
For the nine-month period ended 31 March 2021, The Very Group’s EBITDA increased by 17.7 per cent to £211.0 million compared to £179.2 million for the same period in FY 2020. Its profit before tax for the period increased to £43.8 million, compared to £38.0 million for the same period in FY 2020.
The Very Group’s sales rose by 16.7 per cent to reach £1,788.0 million for the period in FY 2021 compared to £1,532.5 million for the same period in FY 2020. The online retail subsidiary of the company - Very.co.uk revenues grew by 22.1 per cent to £1,443.6 million compared to £1,182.6 million for the same period in FY 2020, aided by the rising sales of popular brands through its platforms, mobile-first customer experience, and availability of a number of payment options. While the group-owned Littlewoods’ revenues declined by 1.6 per cent to £344.4 million in the nine-month period ending 31 March 2021 compared to £349.9 million for the same period in FY 2020.
Conclusion:
The Very Group owners – the Barclay family selecting a trio of investment banks – UBS, Morgan Stanley, and Barclays as the book-runners to coordinate and manage the online fashion retailer’s £4 billion IPO debut, is a step forward in making a strong debut on the exchange.
