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Bebe Stores buys Buddy's Home franchises for $35 mn

13 Nov '20
1 min read
Pic: Bebe Stores
Pic: Bebe Stores

Bebe Stores, Inc, a global specialty licensor of women’s apparel and accessories that distributes Bebe branded products, has purchased 47 Buddy’s Home Furnishings rent-to-own franchises from Franchise Group, Inc for $35 million. The agreement also grants Bebe the rights to build additional franchises in protected geographies throughout the Southeastern US.

The transaction will be funded by a 1.5 million primary share purchase by B Riley Financial at a price of $5.00 per share, a $22 million secured loan led by MILFAM, LLC, and available cash on hand, Bebe said in a statement.

“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 Bebe CEO Manny Mashouf. “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 utilises existing net operating loss carry-forwards. Additionally, the expanded operational infrastructure being developed for this transaction can be leveraged to support additional acquisitions of high free cash flow entities in the future.”

Fibre2Fashion News Desk (RKS)

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