Wesfarmers to buy online retailer Catch Group for $230m
Written on the 12 June 2019 by Matt Ogg
Perth-based Wesfarmers (ASX: WES) is entering new territory in e-retail through an agreement to buy Catch Group, a homegrown company that has recently beefed up its warehouse capacity in Melbourne.
If the $230 million transaction goes ahead, Catch Group will operate independently of Wesfarmers' other retail businesses Bunnings, Kmart, Target and OfficeWorks, but will still be overseen by Kmart Group managing director Ian Bailey.
Wesfarmers managing director Rob Scott says the Catch Group acquisition is consistent with the company's disciplined approach to capital allocation, including investment in opportunities adjacent to its existing businesses, as well as a focus on building its data and digital capabilities.
"Catch Group has a high calibre management team and a leading e-commerce platform with quality fulfilment assets," says Scott.
"This acquisition represents an opportunity to accelerate Wesfarmers and Kmart Group's digital and e-commerce capabilities whilst continuing to invest in the unique customer and supplier proposition provided by Catch Group."
Catch Group has experienced significant growth in recent years offering branded products on a first-party basis and a third-party online marketplace, supported by two fulfilment centres in Victoria.
Catch Group CEO Nati Harpaz says his team is looking forward to becoming a part of the Wesfarmers Group and working with the Kmart Group for the benefit of Catch's business partners and customers.
"Catch will continue to deliver innovation in the online market in Australia, with the focus of delivering great value and savings to our customers," says Harpaz.
"We are excited to work with the Catch team and look forward to leveraging our capabilities to grow the business and accelerate the customer-driven, omni-channel initiatives across Kmart and Target," says Ian Baily of Kmart Group.
"This will further drive best practice in supply chain, fulfilment and online execution across our brands, including opportunities for Target to secure online fulfilment capacity and productivity benefits. Catch will also benefit from the support of Kmart Group's scale and capabilities to drive its continued growth in its existing marketplace business."
Wesfarmers expects merger clearance from the Australian Competition and Consumer Commission (ACCC) in the coming months.Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.
Business News Australia
Author: Matt Ogg