Major PE firms said to be circling £600m Matchesfashion

Major private equity houses are reportedly circling Matchesfashion, which is said to be valued in the region of £600m.

According to Sky News, Apax, KKR and Permira are among those interested in tabling bid for the luxury multichannel retailer, which was established by Tom and Ruth Chapman 30 years ago. Bain Capital is also said to be running the rule over the business in a sale process that is being run by Catalyst Corporate Finance.

The report comes after it was first revealed last month that the business may be sold as its minority stakeholders Scottish Equity Partners and Highland Capital, who invested £32m five years ago, seek to exit.

Tom and Ruth Chapmans remain the major shareholders in the business and, should the valuation be proved correct, a sale could land them £300m. However Sky News reports that they may seek retain a large stakeholding and only allow a minor stake to be sold, although the PE houses would be keen to have a controlling stake.

Matchesfashion was founded as a boutique in Wimbledon Village in 1987 and the business went on to open several more in well-heeled London neighbourhoods including Richmond, Notting Hill and Marylebone. Earlier this year it opened a dedicated boutique for its own label Raey in Notting Hill.

It moved into ecommerce in 2006 (its website stocks around 400 brands and ships globally) and in 2015 the Chapmans handed over the CEO reins to Ulric Jerome to become co-chairs of the business. It has since been innovating with technology and logistics, such as launching a dedicated French language site and offering 90-minute deliveries within London.

In March Matchesfashion revealed that sales in the 2016 financial year had increased by 61% to £204m, while EBITDA was up nearly six-fold at £19m.