Joules acquires digitally-led home and garden retailer, The Garden Trading Company

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Joules, the premium British lifestyle brand, is pleased to announce that it has acquired The Garden Trading Company, a digitally led retailer of home and garden products inspired by the British countryside and lifestyle trends.

Garden Trading designs its own range of distinctive home, garden and outdoor products that it sells through its own digital platform direct to consumers and to more than 1,000 stockists across the UK. Garden Trading has seen rapid growth in its e-commerce revenue over recent years as it has broadened its product range and increased its customer base. Garden Trading has been a leading seller on the Friends of Joules digital marketplace since Joules launched the marketplace in 2019.

Strategic rationale

The Acquisition supports Joules’ strategy to grow its customer base, broaden its product offer and strengthen its digital platform.

The acquisition strengthens Joules’ position in the important and fast-growing home, garden & outdoor category. Garden Trading has a close cultural alignment with Joules, and both share the same design-led approach to creating distinctive, quality products that are loved by their customers. 

Joules intends to continue to develop and grow the Garden Trading brand and product range whilst also seeing opportunity to leverage Garden Trading’s design and sourcing strengths to develop a broader range of Joules-branded home, garden and outdoor products.  

For the year to 30 November 2020, Garden Trading delivered revenue of £16.8 million, up more than 40% on the prior year, and a profit before tax of £2.0 million.

The acquisition is expected to be earnings accretive for Joules FY22 financial year.

Transaction overview

The consideration for the acquisition is split between an upfront and a deferred element. The upfront consideration is for £9 million subject to certain customary completion adjustments. The upfront consideration is comprised of a £4.5 million cash payment (on a cash free, debt free basis subject to a normalised level of working capital) and 2.83 million new Joules ordinary shares of 1 pence each (“Ordinary Shares”). The deferred consideration is for up to £3.5 million (of which at least £3 million will be paid in cash and the rest either in cash or Ordinary Shares, at the Group’s discretion), subject to Garden Trading meeting certain targets over the period to 30 November 2021. Any Ordinary Shares issued pursuant to the Acquisition are subject to certain customary lock-up and orderly market arrangements.

Garden Trading’s founder and managing director, Jon Holloway, will remain with the business until the end of December 2021.

Nick Jones, CEO of Joules, commented: “We are delighted to announce the acquisition of Garden Trading, which is a fast-growing and highly complementary brand to Joules in the attractive home, garden & outdoor category. The acquisition will help to increase the Joules customer base, broaden our product offering and strengthen our digital platform, which are three of the Group’s key strategic growth pillars.

“The Garden Trading brand shares similar design-led principles to Joules and, as has been demonstrated through its stand-out popularity on the Friends of Joules digital marketplace over the past 15 months, is highly relevant to our customers and their lifestyles.

“Garden Trading has a fantastic team and culture, which is closely aligned to Joules’. I am delighted to welcome Garden Trading’s team to the Joules family and look forward to working with them all over the coming years.”

John Hutchinson, corporate partner at BDB Pitmans, who led the team on the transaction, remarks: “Most of us have spent more time at home than we would have liked over the last year. The growth of online retail as a result of the pandemic, including home, garden and outdoor, has generated increased market activity in this sector.

“We are delighted to have contributed by facilitating the successful sale of Garden Trading to Joules. The two are closely aligned and share many similarities in terms of their brand, culture and values. We wish them all the success in the future.”

Jon Holloway, founder of Garden Trading, commented: “We are delighted to be joining Joules, which is a business and brand I have long admired. Since we started selling through the Friends of Joules digital marketplace more than a year ago it has become increasingly clear how well our products and brand resonate with the Joules customer base. In addition, by working with the Joules team it is clear that we share similar values, culture and customer-centric approach.

“I would like to take this opportunity to thank all my colleagues as well as our loyal customers who have helped to develop Garden Trading into the established and popular brand it is today. With the continued dedication of the Garden Trading team alongside the support and infrastructure that Joules offers, I am very confident in the growth opportunities ahead for the Garden Trading brand.”