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Postie Plus Group Limited (PPGL) has reached conditional agreement to sell its chain of Babycity stores as it reconciles its retail operations in readiness for expansion.
PPGL chairman Richard Punter said that Babycity did not fit the business model and growth strategy of the Group.
“The sale of Babycity is an important step to reconcile our business model to that of Postie Group and our flagship retail brand,” he said. “We believe that the Group should eventually be twice the size that it is today and while some of that growth will be organic, we intend to acquire complementary brands that we have identified to further develop our retail footprint nationwide.”
“We have locked in efficiency gains and improvements in the cost of doing business, securing a solid structural, operational, and financial platform for managed growth so as to achieve our aim of being a modern, exciting retailer well connected with customers in multiple retail channels,” he said.
PPGL Chief Executive, Ron Boskell said the purchaser was Baby City Retail Investments Limited, a company operated by Trevor Douthett and owned by him along with private equity supplied by persons he has known for over 20 years. Mr Douthett, formerly of L V Martin, has had a desire to enter the retail market as an owner operator and values the Babycity brand. Completion of the transaction is targeted for early May, subject to shareholder approval.
“Trevor is looking forward to working closely with the existing team and the Babycity business will continue to have its apparel supplied by PPGL under a wholesale agreement,” he said.