Norwich's Naked Wines snapped up by rival Majestic Wine
PUBLISHED: 09:26 10 April 2015 | UPDATED: 15:19 10 April 2015
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Retailer Majestic Wine is to buy online rival Naked Wines for up to £70 million.
Norwich-based Naked Wines, founded in 2008, runs a crowd funded business where around 300,000 subscribers help fund over 130 independent winemakers in 14 countries in exchange for access to exclusive wines at preferential prices.
It generated sales of £74 million last year, up 40pc on a year ago, but made a loss of £3.3 million.
The firms said the combination boosted Majestic’s online presence while providing Naked Wines with a nationwide store network to allow a click and collect delivery option for its customers.
Majestic and Naked Wines will continue to operate as independent brands.
As part of the deal Naked Wines founder and chief executive Rowan Gormley will take over as boss of the enlarged group. He replaces Majestic’s Steve Lewis who left the retailer after six years in February following poor sales.
Majestic Wine trades from over 200 outlets and has over 640,000 active customers. In January it said like-for-like sales edged up 1.1pc in the ten weeks to January 5, but that it had to sacrifice margin in order to shift stock during the period. Total sales lifted 3.7pc.
Mr Gormley said the deal provided “the very exciting opportunity to build a world class wine retailer, serving customers who are looking for inspiration that the supermarkets cannot provide”.
Majestic Wine chairman Phil Wrigley added: “The acquisition of Naked Wines represents a transformational deal. The two businesses have significant strengths which are very complementary.”
Naked Wines reported a 37pc surge in sales of rosé wine in recent weeks as customers get ready for spring.
It has also seen an 18pc increase in sales of champagne and other sparkling wines helping year-on-year group sales figures to climb by 20pc.
The firm, based at Holland Court, in The Close, announced in July last year that its focus on expanding its market reach into USA and Australia had fuelled a surge in worldwide sales.
The business, which employs about 120 people in Norwich, said its rapid expansion saw it add 30 people to its workforce in the 12 months to September last year.
It was a finalist in the business of the year category sponsored by Barclays at last year’s EDP business awards.
Naked Wines is two-thirds-owned by German winemaker WIV Wein International, with 10pc held by senior management and the rest owned by Mr Gormley.
The online firm launched international operations in the US and Australia in 2012, which account for around 40% of group sales.
Mr Gormley has previously helped found a number of firms including Virgin Wines, Virgin Money and the Virgin One account.
Brokers at Investec praised Majestic’s “radical thinking” and said it would give the company growth opportunities beyond the UK.