French upmarket department store chain Galeries Lafayette has unveiled plans to acquire a 51% shareholding in eCommerce retailer La Redoute to strengthen its online business.
Intending to acquire La Redoute in the future, Lafayette's proposed transaction will form a new omni-channel retail group specialised in fashion and home furnishings.
Already operating in this area, La Redoute has registered annual revenue of €750m.
Galeries Lafayette group executive board chairman Philippe Houzé said: “While the fashion and retail industries face unprecedented global change, the complementary positioning and expertise of La Redoute and Galeries Lafayette, the Group’s flagship brand, would establish us as a leading physical and digital retailer specialised in fashion and home furnishings, with French roots and international outreach.”
As well as fast-tracking Lafayette's digital transformation, the transaction allows La Redoute to consolidate and pursue sustainable growth. The department store retailer also intends to achieve operational synergies and share knowledge in procurement, store network, and data.
La Redoute co-chairmen Nathalie Balla and Eric Courteille said: “The backing of a prestigious and long-term investor such as Galeries Lafayette group will give us the resources and capabilities we need to pursue and accelerate our strategy.
“The opportunities created by this link-up will facilitate further new developments in France and internationally, bringing us closer towards our sales target of €1bn by 2021.”
Completion of the transaction is contingent on the outcome of a consultation process with La Redoute’s employee representative bodies and approval by regulatory authorities.