Allegro Fund III announced the exit via an IPO and ASX listing of Best & Less Group
On 9 July 2021, Allegro Fund III announced the exit via an IPO and ASX listing of Best & Less Group, Australia’s leading value apparel specialty retailer, that comprises of retail brands Best & Less in Australia and Postie in New Zealand.
Allegro Fund III acquired Best & Less Group (formerly Value Retail Group and formerly the General Merchandise division of Greenlit Brands) in December 2019. Over Allegro’s investment period, management successfully achieved the follow growth objectives in their investment plan;
- Completed the effective transformation from Greenlit Brands and the establishment of the Best & Less Group as a standalone and sustainable business, in control of its own strategy, operations and funding;
- achieved a strong acceleration in the disruption transformation program, completed and implemented a store optimisation program, invested into the e-commerce channel and customer loyalty programs, restated stalled sourcing, supply chain and traffic conversion initiatives and added additional resources to support the baby, kids and women’s categories; and
- implemented a more ambitious growth strategy that leveraged industry tailwinds and combined new store openings, increased like for like sales growth and high growth in e-commerce penetration, to further gain market share and materially increase EBITDA growth.
Today Best & Less Group operates across a profitable 245 physical store and online channel network and is one of the largest value apparel omnichannel retailers across Australia and New Zealand.
On 26 July 2021 Best & Less Group (ASX:BST) successfully listed on the ASX after experiencing significant institutional and retail investor demand, raising $60 million at $2.16 per share, representing a Market Capitalisation of $271 million. The IPO followed the strategic $40 million equity investment from BB Retail Capital (BBRC), a private investment firm founded and chaired by experienced retail entrepreneur Brett Blundy.
Allegro Fund III sold 41% of their shareholding immediately after the completion of the IPO, retaining 42% shareholding post the IPO offering, which is subject to a staged escrow arrangement until the release of the Company’s H1 FY23 results to the ASX.
The partial exit of the Best & Less Group delivers Allegro Fund III investors, including VPEG3, another strong investment return across a 1.5-year investment period, with the partially realised proceeds expected to be received by VPEG3 and distributed to all VPEG3 investors during the September 2021 quarter.