ORLANDO, Fla. – The owners of Bebe, a woman’s apparel retailer, have purchased 47 Buddy’s Home Furnishings rent-to-own locations for $35 million.

Bebe also purchased the rights to open 20 more Buddy’s franchises in the southeastern U.S. from Virginia-based Franchise Group Inc., an operator of franchised businesses that also include Liberty Tax Service, American Freight and The Vitamin Shoppe. On a combined basis, Franchise Group currently operates more than 4,000 locations predominantly located in the United States and Canada.

“We are pleased to partner with the founder and principals of Bebe to grow the Buddy’s business,” said Brian Kahn, Franchise Group CEO. “This transaction is a good example of how Franchise Group can use refranchising company-owned units to simultaneously de-lever its balance sheet and create growth for its brands.”

Financial analysts say the deal gives Bebe a foothold in the robust home furnishings category that has been growing during the pandemic.

“This is a transformational acquisition that will not only be materially accretive to Bebe’s cash flow over time but also provides a platform for future growth through the development agreement,” said Manny Mashouf, Bebe’s CEO, in a statement. “The acquired Buddy’s stores have a strong and consistent record of free cash flow generation across multiple market cycles. This acquisition diversifies Bebe’s profit stream and better utilizes existing net operating loss carryforwards.”

Bebe closed all of its brick-and-mortar stores in 2017 to focus exclusively on online sales. The next year, B. Riley Financial took a 28% stake in the company.

Buddy’s Home Furnishings bills itself as the largest independent rent-to-own operation in the country, with more than 300 total locations.

The post Apparel retailer acquires 47 Buddy’s Home Furnishings locations appeared first on Furniture Today.

Translate »
0
Your Cart