Frasers Group acquires Matches
Frasers Group has confirmed the acquisition of Matches from private equity firm Apax Partners in a £52 million deal.
The move marks a significant loss for Apax Partners, which purchased the business in 2017 at a reported valuation of £800 million.
It comes as the retailer has been loss-making in recent years, reporting a loss of £33.5 million for the year to 31 January 2023.
Matches was founded as a luxury boutique in Wimbledon by Tom and Ruth Chapman in the 1980s. The pair sold their majority stake six years ago and moved into an advisory role.
Since the Chapmans' departure, the business has struggled to find stable leadership and former ASOS Chief Executive Nick Beighton was appointed as CEO in July 2022 to replace Paolo De Cesare, who joined the company just 10 months earlier.
Additional funding injected into Matches earlier this year was seen a sign of confidence from Apax in the leadership of Beighton.
However, the struggles of Matches come amid a global slowdown in the luxury market, which has also affected Farfetch, having been recently rescued by South Korean retail giant Coupang.
Beighton will remain at the company, working with Frasers to develop a strategy to "build on the underlying strength of the business whilst rapidly unlocking synergies with Frasers".
"Since I joined Matches last year, we have made good progress, sharpening our brand and product curation and improving the day-to-day operations of the business," said Beighton.
"As a result, we have seen a resilient trading performance despite the challenging economic backdrop.
"Being part of Frasers, with their utter commitment to luxury, will give this business access to greater scale, best-in-class retail expertise and the financial stability it needs to more effectively deliver for our brand partners and our customers."
The purchase of Matches strengthens Frasers' elevation strategy as it looks to dominate the luxury multi-brand market through its Flannels brand and the acquisition of JD Sports' premium fashion boutique business earlier this year, adding Giulio, Cricket and Tessuti, among others, to its Premium Lifestyle portfolio.
In its most recent trading update, CEO Michael Murray issued a note of caution on the softening of the global luxury market.
Murray, however, said Frasers remained ambitious when it came to expanding its luxury, or Premium Lifestyle, arm.
"Our long-term ambitions for our Premium Lifestyle business remain unchanged although it is likely that progress will remain subdued for the short to medium term in the face of a softer luxury market however, we continue to invest with confidence in our unique proposition," Murrary said at the time.
As well as owning Flannels, Frasers holds stakes in premium brands Mulberry and Hugo Boss. Its wider retail portfolio also includes Sports Direct, House of Fraser, USC and Jack Wills, among others.
