Catch and Lux strike biggest e-commerce deal yet
A pair of local e-commerce groups have completed the largest homegrown transaction in Australia, fuelling growth ambitions based on corporate entities honing their expertise in separate fields.
On Tuesday, Catch Group and Lux Group announced a series of strategic transactions that will result in the creation of separate, pure-play travel, shopping and local e-commerce businesses.
With a combined estimated turnover of over $600 million across all businesses, the deal represents Australia’s largest home grown e-commerce transaction.
As part of the deal, Catch has acquired Lux’s designer brand product businesses, which include Brands Exclusive and TheHome, to sit alongside existing product platforms Catch.com.au, GroceryRun, Mumgo and Pumpkin Patch.
Luxury Escapes has also bought BonVoyage and Scoopon Travel and the group’s local experience businesses have now merged into an independently-operated joint venture, which will include businesses Scoopon, Cudo, LivingSocial, Deals.com.au and New Zealand-based TreatMe.
Both Lux and Catch will provide exclusive product and travel to the local experience joint venture, with 50/50 ownership.
Following the transactions, Lux Group will become a pure travel business, with a well-rounded offering headlined by market leader, Luxury Escapes, complemented by newly-acquired BonVoyage and Scoopon Travel.
Catch will become a pureplay e-commerce business focused on a diversified product range, combining the market-leading Catch.com.au with Brands Exclusive and TheHome.
As part of the transactions, Catch Group founders, Gabby and Hezi Leibovich, will become 20 per cent shareholders in the Lux Group, which was founded by Adam Schwab and Jeremy Same.
Catch is coming off the back of its strongest month in the company’s history, after seeing weekly sales hit over $8 million.
“We think we have found the right formula for growth, this is just another way for us to grow even further by acquisition,” Catch Group CEO Nati Harpaz told Internet Retailing.
“E-commerce is about scale and the ability to run one cost base but which has many customers as possible,” he said.
“So by putting this together, we’re creating a lot of synergies and we’re increasing our scale – our scale of buying, of selling and fulfilling.”
Schwab told Internet Retailing the deal had been in the making for five years and would allow both businesses to hone in on their fields of expertise.
“The transactions allow us to get a lot better at what we do really well,” he said.
“The Catch guys do product incredibly well, they’ve got fantastic infrastructure, next-day delivery, great customer service and one million plus customers, so it makes a lot of sense from their perspective.
“It’s a really great win-win. Our customers benefit, our clients benefit from having a bigger customer base and our staff and our teams benefit from being part of great Australian businesses.”
Nati Harpaz, CEO of Catch Group, is the chairman of Octomedia, Internet Retailing’s parent company.