Frasers, led by Mike Ashley, has acquired luxury goods websites from THG in a deal that also involves integrating THG’s online health and beauty products, such as protein powder from its Myprotein brand, into Sports Direct stores.
THG announced on Monday that it sold several sites, including Coggles, to Frasers as part of a broader partnership. This agreement includes Frasers utilizing THG’s technology across its operations.
This move marks the latest step in Mike Ashley’s strategy to shift Frasers’ focus from Sports Direct towards higher-end brands, including House of Fraser and Flannels, aiming to reduce dependency on Sports Direct, which currently constitutes half of the company’s sales.
For THG, the deal provides access to a new retail customer for its technology services and creates a retail outlet for its products in Sports Direct stores. Frasers, in turn, will leverage THG for courier management and to run its delivery operations in Australia.
THG has faced challenges since its IPO on the London Stock Exchange, initially valued at £5.6bn in September 2020, but now valued around £800m. Led by Matthew Moulding, who briefly became a billionaire on paper due to his 15% stake, THG initially focused on selling CDs tax-free online before pivoting to managing websites for other retailers, alongside its direct-to-consumer operations.
THG’s luxury division, which includes the Coggles brand, reported approximately £43m in sales for the 2023 financial year, nearly achieving profitability despite a tough luxury market.
Frasers, known for acquiring struggling sports and clothing brands, has recently added Jack Wills, Gieves & Hawkes, Evans Cycles, Game, Missguided, and I Saw it First to its portfolio. In a recent move, Frasers placed Matchesfashion into administration shortly after acquiring it, citing unwillingness to finance its turnaround.
