Shares in fledgling online women’s fashion retailer Sosandar began trading on AIM today following its reverse take-over by cash shell Orogen Plc. It joins a growing band of fashion brands trading on London’s junior stock market.
Orogen revealed its plan last month to acquire Sosandar‘s parent company Thread 35 Ltd for a total consideration of £6.3m, and that as a result the fledgling etailer would gain an AIM listing. It also revealed it had raised £5.3m (before expenses) through a conditional placing of 35,099,338 new Ordinary Shares at 15.1 pence per share,
Orogen was formerly a gold exploration company but became an AIM rule 15 cash shell in April having decided to exit that market. Shortly after becoming a cash shell it agreed heads of terms with Thread to acquire its entire issued share capital, subject to certain conditions and due diligence. This morning 106,814,658 shares in Sosandar were issued upon its admission to AIM giving it a market capitalisation of approximately £16.1m.
Sosandar was founded in September last year by former Look magazine editor Ali Hall and former Look and InStyle publishing director Julie Lavington. The pair have positioned the brand as a destination for women who have moved on from young fashion etailers but still want trend-led, affordable fashion; a market segment they say is underserved.
The business achieved total gross sales for the 11 months ended 31 July 2017 of £847,000 and net sales (after returns) of £478,000; it had also completed two seed investment rounds to fund the design of the initial Sosandar fashion range from scratch, build the “mobile-first” website and develop a scalable supply chain including overseas manufacturers and UK based logistics suppliers.
“Sosandar has truly resonated with a new generation of fashion conscious women looking for chic, trend led, quality but affordable clothes. The Sosandar team is very excited by the opportunities ahead,” said Hall of the float.
“Today’s announcement coupled with this significant investment heralds a very exciting time for the brand. Sosandar intends to expand its market share in the already large and successful, yet still growing online fashion market. Investment will be used to further extend the product range and develop brand awareness amongst potential customers,” Lavington added.
Sosandar is one of two fashion companies to to launch on AIM today. Last week young fashion and footwear retailer Footasylum confirmed it would be valued at £171m when its shares began trading this morning.
Glasgow-based young fashion retailer QUIZ also launched on AIM earlier this year with an initial market capitalisation of £200m, while fast fashion etailers ASOS and Boohoo are also AIM-listed.