New accessory for Barclays Private Equity
Barclays Private Equity, which recently completed the MBO of Hobbs, has added to its fashion brand portfolio by backing the €44.1 million management buy-out of DCK Concessions. The only major jewellery concession retailer in the UK, DCK operates through 1,900 concessions in high street fashion retail chains such as TopShop and Dorothy Perkins.
Barclays Private Equity, the leading pan-European mid-market private equity house, has taken a 32 per cent stake and the debt element of the deal has been provided by Barclays Leveraged Finance. The transaction was initiated by Invex Capital Partners which has also taken a minority stake in the business.
For each fashion store DCK provides jewellery and accessories with a dedicated range, for example, ‘Freedom’ at TopShop and ‘Diva’ at Miss Selfridge. It is given rent free space by host retailers which receive commission on sales.
The company has grown dramatically over the last three years, with sales increasing from €16.3 million in 2000 to €51.7 million in 2003 and this level of growth is anticipated to continue. The costume jewellery market was worth €520 million in 2002, having grown 14 per cent in volume terms since 1996*.
John Walker, who led the deal for Barclays Private Equity, said: “With our experience in the retail fashion sector, from backing New Look some years ago to the MBO of Hobbs at the end of 2002, we recognised that DCK has strong growth prospects. The company excels in an area where the high street stores cannot – delivering a truly outsourced service managing high volume products that have a low unit value alongside a short ‘shelf life’. DCK acts in a partnership role with the host retailers, not purely as a supplier.”
Alan Witzenfeld, a co-founder of DCK in 1992, will remain as CEO. He is supported by a strong, capable management team. Barclays Private Equity has appointed Frank Dee, an experienced retailer who is currently a non-executive director of Speedy Hire plc, Leeds and Holbeck Building Society and Marr Foods, as non-executive Chairman.
Alan Witzenfeld, CEO of DCK, said: “Our company has grown hugely over the last few years, however with the support of Barclays Private Equity we aim to achieve even greater goals – upping sales, product lines and the number of retailers that stock our accessories both in the UK and in Europe.”
Sarah Padilha, Relationship Director in Barclays specialist Retail and Wholesale teams said: “Our in-depth understanding of the retail sector in the UK and of the financial needs of DCK allowed us to provide not only the debt that the company required for this deal, but also the ongoing banking services which will help them grow and develop.”
Management has taken a majority stake in the business, with Invex Capital investing in a minority interest. Senior debt was provided by Paul Morris, Mike Dennis and Heeral Shah of the Barclays Leveraged Finance team, including the provision of working capital. Management was advised by Grant Thornton Corporate Finance and Herbert Smith. Barclays Private Equity was advised by KPMG and Addleshaw Booth. p>
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