The leading franchise retailer in Saudi Arabia, Fawaz Abdulaziz Alhokair (Alhokair) and Kingdoms’ well-known owner, developer and operator of lifestyle shopping centers, Arabian Centres Company (ACC), will acquire a combined 51 percent stake in Vogacloset, a UK-based online fast fashion platform.
The buyers will acquire 41.2 percent of Vogacloset’s existing shares based on a pre-money valuation of $60 million, subject to an earn-out structure conditional on certain growth thresholds. In addition, $12 million will be introduced into the capital of Vogacloset to boost its presence in the Saudi market and to further pave the path for the Alhokair brands and ACC tenant brands to enter into the eCommerce platform.
“Our investment in an online fashion and beauty platform of Vogacloset’s caliber is a significant milestone in our transformation and represents an exciting opportunity. This strategic investment in a sizeable and profitable regional eCommerce player is the most direct route for Alhokair to extend its leadership position in its core Saudi market, from offline to the online space while safeguarding our competitive market position.”
The buyers’ principal objective for their investment in Vogacloset is to boost digital transformation and create a truly modern retail business in the region. By joining with a leading eCommerce platform they intend to create an industry-leading partnership in Saudi Arabia that utilizes Vogacloset’s customer-centric business model, efficient logistics chain and deep understanding of regional and global fashion trends.
The companies will integrate Vogacloset with a joint venture to support opportunities aimed at building the two Saudi retail players’ omnichannel capacities. The companies have already started working on plans to launch loyalty programs and consumer finance offerings.
“In line with our ambition to create Saudi Arabia’s first specialized digital retail platform, the partnership with Vogacloset will greatly enhance convenience and engagement for tenants and customers,” said Faisal Al Jedaie, Chief Executive Officer of ACC.
The deal is expected to be completed by end of June 2021, subject to the fulfillment of various conditions.