Bridgepoint acquires Fat Face


Bridgepoint has signed a binding agreement to acquire the UK's leading active lifestyle brand, Fat Face, from Advent International in a transaction totalling £360 million.

Fat Face, established in 1988, retails premium men's, women's and children's clothing and accessories, created by its own in-house design team. The company, which is forecast to have £111m of turnover and run rate EBITDA of £30.4m for the year ended 31 May 2007, operates a multi-channel model which includes 128 owned retail stores, mail order catalogues and an internet store. It has over 1,500 employees.

Bridgepoint estimates that the market for active lifestyle clothing, the market addressed by Fat Face, is worth £2.2 billion annually and has grown significantly faster than the overall UK clothing market. As a leading specialist in its segment, Fat Face has also grown sales and store numbers faster than all other specialists since 2004.

Fat Face will continue to be led by the incumbent CEO Louise Barnes and FD Stuart Owens who, along with the rest of the management team, will be reinvesting in the business. Alan Giles, who was appointed in October 2006, will remain as non-executive chairman of the business.Louise Barnes commented:

"This is a terrific deal for Fat Face. It marks the completion of a successful two years under Advent's ownership and recognises the great potential for this exciting brand and, together with Bridgepoint, we firmly believe we can bring our plans for the future to life.

We are excited to be embarking on this next chapter of the Fat Face story taking our unique proposition and the 'Life is out there' philosophy to new audiences both at home and abroad."

Fat Face already operates four sites outside the UK, of which two (Iceland and Dubai) are franchise agreements. Future planned openings include stores in the Middle East, Hong Kong and Singapore. In the UK, it is anticipated that up to 15 new stores a year will be opened.

"Fat Face has a unique and very distinct retail proposition which has been developed successfully by an experienced and established management team." said Guy Weldon, partner at Bridgepoint.

"It operates in a high growth segment of the clothing market with strong brand appeal and has demonstrated resilient and consistent like-for-like performance." he added.

Bridgepoint has been an active and successful investor in the European retail sector through investments in Pets at Home and Molton Brown in the UK, Nocibé and Alain Afflelou in France and Limoni in Italy.

Debt will be provided by BNP Paribas, advised by White & Case (legal). Advisers involved in this transaction included: for Bridgepoint - UBS (corporate finance), KPMG (financial due diligence), Pragma (commercial/market), Marsh (insurance), Travers Smith (legal); for vendor - Rothschild (corporate finance), Weil, Gotshal & Manges (legal), KPMG (vendor due diligence), OC&C (market due diligence); for management - Berwin, Leighton, Paisner (legal) and PWC (tax).

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