Boohoo’s €300m deal bags remaining 34pc of Pretty Little Thing

ONLINE fashion retailer Boohoo has bought the remaining stake of Pretty Little Thing from its founder and operating chief for £269.8m (€300m).

Umar Kamani, who founded Pretty Little Thing, could see the amount rise by £54m if the deal can help Boohoo shares hit 491p a share for a six-month period at some point over the next four years.

Mr Kamani, a prolific user of Instagram, is the son of Boohoo founder Mahmud Kamani.

The deal for the women’s fashion brand aimed at the 16- to 24-year-old market was an “important further step towards achieving its vision to lead the fashion e-commerce market globally”, Boohoo said in a statement.

The deal, which had been played down by the company following initial reports, is the latest in a string of acquisitions made by the fashion business, including high street names Karen Millen and Coast.

Boohoo said: “After this acquisition and with its growing platform of wholly owned, innovative fashion brands, the group believes it can continue to successfully disrupt the international markets it operates in today whilst retaining a strong balance sheet in order to take advantage of numerous M&A opportunities that are likely to emerge in the global fashion industry over the coming months.”

Since Boohoo bought a 66pc stake in Pretty Little Thing in January 2017, revenues have hit £516m with profits of £45.2m after tax.

“The group intends the senior management team at PLT, including Umar Kamani and Paul Papworth, to remain in their current roles and continue focusing on developing PLT into a global brand,” Boohoo said.

Mr Papworth is currently chief operating officer.

Boohoo said it suffered a “marked” fall in sales for March as the coronavirus crisis struck, but revealed a swift rebound in April as it outshone hard-hit high street rivals.

The group said the recent Covid-19 events overshadowed a “great” financial year but stressed it is seeing improved year-on-year growth of group sales thanks to April’s bounceback.

The company did not shut operations during lockdown, leading to some complaints from unions over working conditions.

John Lyttle, chief executive of Boohoo, said at the time: “Whilst recent events have understandably overshadowed what has been a great year for Boohoo, they have also highlighted its key strengths.”

Shares in Boohoo surged by as much as 13pc yesterday on news of the acquisition.