A family business based in Northampton, which has managed to thrive during the economic downturn, could soon be sold for a rumoured £60 million.
Budget retailer, 99p Stores, is based on the Swan Valley industrial estate on the outskirts of Northampton.
The firm was launched in 2001 by businessman Nadir Lalani, in London. Following its relocation to Northamptonshire, it now has 173 shops across the UK and Ireland and serves more than two million customers a week.
Reflecting on the company’s success, managing director, Hussein Lalani said: “Shoppers’ thirst for value is unquenchable. The ‘value genie’ is well and truly out of the bottle across the high street and there’s no putting it back in.
“When times get better, demanding value will have become an integral part of the daily shopping habit of Britons. That will be one of the better things, if not the only thing, to have come out of this recession.”
The Lalani family put the business up for sale last year and had originally wanted £80 million, according to the Independent newspaper.
But a price tag of between £50 million and £60 million is now understood to be more realistic.
Private equity fund manager, Electra Partners, is thought to be the front runner to buy the firm, but a number of other organisations are also reported to be interested.
If a buyer is found it is believed Hussein Lalani and buying director Faisal Lalani, who are both Nadir Lalani’s sons, would stay on to run the business.
A sale would see 99p Stores follow in the footsteps of its rival, Poundland, which was sold for £200 million to private equity firm, Warburg Pincus, in 2010.
Financially, 99p Stores more than trebled its pre-tax profits to £6.3 million in the year ending January 31, driven by rising sales and improving margins. Its sales increased 26 per cent to £231 million.
Over the next month the firm plans to open several new stores across Britain and Ireland. In the next decade, it aims to have a total of 600 stores, which would see it have sales of more than £300 million and 5,000 employees.
After launching in London, the company moved to Daventry in 2005 because of the county’s central location.
As the business expanded they outgrew their premises and in May 2010 moved to 375,000-sq ft headquarters in Swan Valley.
Source: www.northamptonchron.co.uk
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