Online beauty specialist THG raised eyebrows last month when it snapped up London business newspaper City AM.
It is not the only retail acquisition that no-one saw coming. Retail Gazette rounds up the most leftfield M&A deals in recent years.
Frasers Group buys Gieves and Hawkes
Frasers Group acquired Savile Row retailer Gieves & Hawkes back in November 2022, in efforts to “secure a long-term future” for the brand.
Having dressed royal figures including King Charles III, George VI and George V, the men’s tailor may seem poles apart from the Sports Direct owner.
However, Frasers Group CEO Michael Murray explained the move further added to its “portfolio of strategic investments in luxury and premium brands”.
THG acquires City AM
The Hut Group (THG) took many by surprise when it carried out a last minute bid to save City AM from insolvency in July.
Despite the online beauty retailer seeming like an unusual owner of the newspaper, its co-founder Lawson Muncaster explained it made a “perfect fit”.
“We both believe firmly in the power of business to make peoples’ lives better and we cannot wait to get started with our new partners,” he said.
While the group had previously never owned a newspaper, it does have an online publishing arm with two magazines.
THG boss Matthew Moulding said it had been looking for a partner in the media space for some time.
“We’ve long been reviewing opportunities in the disruptive media space but have waited for the right time and the right opportunity to make a digital step-change in adtech capabilities for Ingenuity,” he said, referring to THG’s ecommerce platform.
City Am, which has around 2 million monthly visitors online and a daily print circulation of around 70,000 , will bring THG added reach into high-value customers who work in the City.
Amazon purchases Whole Foods
Retail giant Amazon bought organic grocer Whole Foods back in 2017, in a move many didn’t see coming.
The $13.7bn acquisition was a launchpad to accelerate Amazon’s growth in grocery.
Many changes have taken place at the grocer since then, such as introducing palm scanning technology and implementing operational changes.
However, despite acquisition, grocery is an area that Amazon has yet to conquer.
Paperchase and Tesco
Tesco snapped up Paperchase and its intellectual property in January after its collapse, but didn’t buy any of its stores.
Commenting on the acquisition in February, Savvy Marketing founder Catherine Shuttleworth described Tesco as “a bit of a left field choice” for the stationery brand.
However, she added: “Given the success of shop-in-shop concepts in non-food areas of supermarkets like toys and clothing maybe it is less of a surprise than we might think”.
She also noted the purchase was a smart move, since it gave Tesco an opportunity to create a branded space in store and maximise key sales points in the events calendar where customers spent big.
Boohoo and Karen Millen
Boohoo bought Karen Millen and Coast out of administration in 2019, as the companies struggled with factors including falling footfall and consumer confidence.
The brands certainly seem to have stark differences on the face of it. While Boohoo generally sells cheap and cheerful clothing, its acquisitions offered premium clothing and targeted an older and more affluent customer.
Indeed, that was the point of the purchases, to widen Boohoo’s customer base.
It has since built on this by adding Debenhams to its stable after it bought the brand’s IP in January 2021 after it collapsed.
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