Kishore Biyani is buying a significant stake in London-listed online fashion retailer Koovs.com, his latest attempt to crack the e-commerce fashion market after his unsuccessful 2016 bid to buy Jabong.com, that was subsequently bought over by Flipkart’s unit Myntra.
Biyani’s Future Lifestyle Fashion will acquire about 30% stake in Koovs for about Rs 140 crore and that will make the Future Group company the largest shareholder in the AIM London-listed fashion e-commerce company that sells its private labels and curated fashion and lifestyle products.
Subject to conditions, Koovs will issue Future Lifestyle with 57,876,600 new ordinary shares at a price of 10 pence per share, representing 24.8% per cent of the enlarged issued share capital, raising £5,787,660 of cash, according to a statement of Koovs’ website.
Prior to Biyani, other famous Koovs investors include British businessman-turned-politician Lord Waheed Alli, a former chairman of Asos.com and Alli also founded Koovs in 2012.
“Lord Alli has committed to invest £1.5m in the equity raise and FLFL (Future Lifestyle) has conditionally agreed to make additional investments to take its ownership up to 29.9% within six months of completion of the equity raise,” the Koovs statement said.
“The transaction will be done in two phases and will also involve other investors making further investments in the entity,” a person familiar with the deal told ET. “It will make Future Group the largest shareholder and manager of the entity.”
Koovs curates fashion from various international brands targeted at 18-34 years old Indian youth and about 40% of the company’s sales come from its private labels. The company at present has a revenue of about Rs 200 crore.
Future Lifestyle is cash-rich after selling 10% stake in May to LVMH Moët Hennessy Louis Vuitton-owned private equity fund L Catterton Asia for about Rs 900 crore. The person quoted about said Biyani will use the money from the L Catterton sell-off to buy stake in Koovs that sells mostly private labels through its website.
“We like their (Koovs) positioning as they are high on curated fashion and we can bring synergies. Online fashion has taken off in India and we think we can make Koovs big and viable,’’ Biyani told ET. “It gives us a platform to sell our other existing portfolio.”
Future Lifestyle markets a portfolio of more than two-dozen global and local brands including Lee Copper, Indigo Nation, Scullers, Clarks, John Miller, Jealoys, CoverStory, aLL among others and also own Brand Factory chain and Central, a large department store chain.
This would be Biyani’s latest stab at e-commerce two years after a failed acquisition of online furniture seller FabFurnish.com from Germany-based Rocket Internet. Future Group last year folded FabFurnish after it was not able to leverage FabFurnish for its planned offline-and-online retail plans with Home Town furniture and home products chain.
Biyani has always had a rough ride with e-commerce. His flagship e-commerce Futurebazaar.com started about a decade ago is currently defunct.
