OpCapita sells value clothing retailer NKD to TDR Capital
Once a heavily loss-making enterprise, NKD now generating significant earnings after being restored by OpCapita
London, 19 March 2019: OpCapita Consumer Opportunities Fund LP ("the Fund"), advised by OpCapita LLP ("OpCapita"), the European private equity partnership, announces the sale of its portfolio company NKD to funds advised by TDR Capital. The transaction is subject to customary closing conditions. Terms are not being disclosed.
Headquartered in Bindlach, Germany, NKD is a leading discount clothing retailer. It operates a chain of ca. 1,800 small-format stores across Germany, Austria, Croatia, Italy and Slovenia, with over-35 females its main type of customer. Over the past three years, its growth has outperformed the market, with an average 7.5% increase in sales per year.
Under OpCapita's ownership, NKD has been restored from a heavily loss-making enterprise at the time of initial investment in 2013 to one generating significant earnings. OpCapita has overseen a professionalisation and strengthening of the management team, focused on optimum pricing to ensure NKD is competitive, re-built the company's supply chain, including reducing the number of suppliers while increasing their geographic spread, and refined the store portfolio, to close underperforming branches and restart expansion. This has resulted in a swing from losses of €34m at the time of investment to EBITDA of €45m in 2018.
Joshua Spoerri, managing director at OpCapita, said: "We are extremely pleased to announce this transaction, which marks the first exit from our first fund. The turnaround we have achieved at NKD is emblematic of OpCapita's approach; taking a struggling consumer business and transforming it into a profitable, stable business with great prospects and that continues to delight its thousands of customers. We thank the management team and all NKD's staff for their hard work over the past few years and wish them every success under TDR Capital as they embark on the next phase of their journey."
Dr. Ulrich Hanfeld, CEO of NKD Group: "We would like to thank the OpCapita team for their invaluable support and guidance. We have mastered a successful turnaround in recent years, thereby paving the way for ongoing sales growth and a further increase in profitability. We are expecting to see robust sales growth and a further increase in our profitability in the years to come – both in comparable sales areas and as a result of expansion. For the current 2019 financial year, we are again planning a strong expansion of our existing markets, with a clear focus on our German home market. We will be managing our growth strategies from our corporate headquarters in Bindlach and are planning to create more jobs across all areas of the company."
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