Flotation windfall for Oasis
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Three directors of Oasis Stores stand to share pounds 12m profits when the company's shares are floated on the stock market later this summer.
The ladies fashion designer and retailer stockmarket flotation, expected to value the company at pounds 75m, is aimed at making the shares more marketable in the run-up to an ambitious expansion programme in the UK and overseas.
Three directors - Michael Bennett, chairman, Maurice Bennett, deputy chairman, and Vivian Scott, managing director - are to sell a third of their combined 60 per cent stake in the company for about pounds 14m. They have invested pounds 2m between them since 1991, when they bought the company from Pinecorp, its struggling parent.
The company heavily hinted that the expansion strategy will include acquisitions. The shares are to be placed with City institutions, with Robert Fleming, the merchant bank, acting as sponsor to the issue.
The share sale represents the second big windfall for the Bennett brothers, who sold out of a stake in Warehouse, the retailer, for pounds 15m before going into Oasis, which has 69 retail units located in cities and towns in the UK and Ireland.
The directors said there was scope to substantially increase the number of retail units as well as increasing average store size. The company, which is associated with marketing of ethnic clothing, intends to widen its range.
In the year ended 28 January, turnover rose by 60.7 per cent to pounds 47.1m compared with the previous financial period, including a 31 per cent increase in like-for-like sales. In the same period, profit before tax grew 64.8 per cent from the previous financial period to pounds 9.2m and the company achieved a gross margin of 53.9 per cent.
The directors believe Oasis has reached a suitable size and an appropriate stage in its development to benefit from the creation of a market for its shares. The share price is expected to be announced at the end of this month.
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