Homewares retailer Adairs has agreed to purchase furniture retailer Focus on Furniture for $80 million.
Focus comes with a 23-store network, $150 million revenue and a small but growing online channel. The majority of its products are designed and sourced by Focus.
Mark Ronan, group CEO and managing director, says the acquisition is strategically significant for Adairs.
“Focus builds out our product offering in the key area of home furniture and increases the exposure we have to that market by almost three times,” he explains.
“The Adairs Group now comprises a highly profitable and aligned portfolio of brands with significant growth potential targeting the middle market in the home category in Australia and New Zealand.”
Indeed, growth opportunities include a national store rollout, online growth and category/range expansion. The two retailers will operate in close adjacency and complementary customer product overlap presents opportunities to leverage strengths in store expansion, product development and last mile delivery capability.
“The acquisition will be earnings per share accretive from day one and we see strong growth opportunities that have the potential to drive sales of more than $250 million over the next five years.”
The omni-channel retailer will continue to operate independently of Adairs with its existing management team continuing under new contracts.
“Focus is led by a highly capable leadership group and a passionate, service-orientated team in its stores, warehouses and support office. We are excited to welcome them to the Adairs Group family and believe that together we can continue to build a truly great business,” Ronan adds.
The acquisition will be effective from 1 December 2021.