UK-based wine retailer Majestic Wine has announced its intention to buy online competitor Naked Wines for £70m.
The purchase price will consist of £50m in cash and a further £20m in Majestic’s ordinary shares. Naked Wines founder Rowan Gormley will become chief executive of the resulting company, after Steve Lewis resigned from the post in February following poor Christmas-period performance.
The acquisition will combine Naked Wine’s online capabilities with Majestic Wine’s retail network, and could significantly increase the two firms’ overall reach. Majestic Wine, which plans to expand further in to the US and Australian markets, added that the brands would continue to operate independently.
Majestic Wine chairman Phil Wrigley said: “The two businesses have significant strengths which are very complementary. Majestic’s distribution skills, a nationwide UK store network and customer service orientated knowledgeable staff, are a perfect fit with Naked Wines’ unique sourcing and selling model.
“This acquisition will significantly accelerate the planned development of Majestic’s online capabilities whilst providing Naked Wines with a nationwide store network to allow a Click & Collect delivery option for its customers. In addition, this acquisition opens up attractive international markets, increasing our potential customer reach eightfold.”
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