MandM Direct chases 170 million in London IPO

MandM Direct will be the last in the fashion industry to float in London. The discount retailer is planning to launch an initial public offering (IPO) prior to start trading on the London Alternative Investment Market (AIM). The move which will value the online retailer at between 140 and 170 million pounds.

The affordable apparel group is owned since 2007 by private equity firm TA Associates.

MandM Direct is the parent group of M and M Direct brands, based in the Midlands, and backed by private equity firm ECI until they sold it for 86 million pounds seven years ago to TA Associates.

Owner of M and M Direct to float in AIM in June

"We are well positioned to benefit from the trends towards online retail and have a clear strategy to develop our UK and to expand our European businesses. This listing represents an exciting stage in our development and will give us the opportunity to further accelerate our growth," said the CEO of the company, Jonathon Brown.

Along these lines, chairman-elect Alan White - former head of Manchester retail group N Brown - added: "I am delighted to be involved with M and M Direct at this stage of its development and am looking forward to working with the high-calibre executive team and board which the business has in place."

In a statement to the stock exchange on Tuesday, MandM Direct said it had launched in three new markets over the past six months and was intending to target further territories over the next two years.

The primary proceeds of approximately 12.5 million pounds will be used to repay the company's existing debt, transaction related fees and provide additional flexibility to help accelerate its growth strategy. Sources close to the company advanced as well that the board is putting in place a new revolving credit facility of up to 20 million pounds.

In the year to 23 February 2014, MandM Direct reported revenue of 118.9 million pounds and EBITDA of 10.5 million pounds, an increase of 9 percent and 21 percent respectively on the prior 12 months.