Majestic Wine is reportedly looking at selling all of its 200 stores in the UK and becoming an online-only operation under its Naked Wines brand.
According to Sky News, Majestic’s management has appointed bankers at Rothschild to explore a sale of the retail and commercial operations, with private equity firms being contacted to gauge their interest.
The potential move comes just a month after the wine specialist outlined plans to build up its business around its fast-growing online brand, which it had said would result in the Majestic name disappearing and some of its stores being closed. Full details of the ‘Transformation Plan’ are due to be revealed alongside its full year results on 13 June.
Commenting on the report, a spokesperson for Majestic said: “While a total sale of Majestic Retail continues to be a potential option, it would be wholly unwise to pursue a single track process and materially limit the potential value that can be realized to drive growth.
“We believe the combination of customer migration, disposals and store closures from Majestic Retail will release substantial investment capital and transform the company into an out-and-out growth business.”
The company’s core retail chain has struggled for growth in recent years amid stiff supermarket and online competition.
NAM Implications:
- Intriguing to speculate if other mixes of retail Bricks & Mortar and online are considering this either-or option…
- Especially with Amazon coming the other way.
- However, applying strict profitability per outlet, combined with apportioning full and inclusive fulfilment costs to online…
- …could lead to consideration of these ‘extreme ‘ options…
