Carlyle Set to Take Control of Very Group, Ending Barclay Family Ownership

What's Happening?

Carlyle, a US private equity firm, is preparing to take control of Very Group, an online retail company, marking the end of the Barclay family's ownership. This transition is expected to occur as early as October, under the terms of Carlyle's financing arrangements. Carlyle plans to exercise its 'step-in right,' which allows the firm to convert its debt into equity ownership. Details of Very Group's capital and ownership structure are anticipated to be confirmed before the control rights are triggered. Additionally, IMI, another creditor of Very Group, is likely to gain a stake or preferred position in the recapitalized company's debt structure. Earlier this year, the Barclay family had considered a full or partial auction of the group, attracting interest in its technology arm and core retail offerings. Very Group had secured a refinancing package worth £598 million in April to strengthen its balance sheet and extend debt maturities.

Why It's Important?

The shift in control of Very Group from the Barclay family to Carlyle represents a significant change in the retail landscape. This move could impact the strategic direction of Very Group, potentially leading to changes in its business operations and market approach. The involvement of Carlyle, a major private equity firm, may bring new investment strategies and management practices to the company. This transition also highlights the challenges faced by traditional family-owned businesses in maintaining control amidst financial pressures and evolving market dynamics. Stakeholders, including employees, suppliers, and customers, may experience changes in business operations and strategic priorities as a result of this ownership change.

What's Next?

As Carlyle prepares to take control, stakeholders will be watching for announcements regarding the new ownership structure and any strategic changes that may follow. The potential involvement of IMI as a creditor with a stake in the company could influence future business decisions. The retail industry will be observing how Carlyle's management style and investment strategies impact Very Group's operations and market presence. Additionally, the outcome of the Barclay family's auction plans and the interest in Very Group's technology arm and retail offerings may lead to further developments in the company's business model and market strategy.