The shareholders of Tapestry Home Brands, led by Westbrooke, today announced that it has entered into an agreement with The Foschini Group (TFG) for the sale of the entire share capital of Tapestry Home Brands (Tapestry), a prominent home furnishings group, for a cash purchase consideration of R2.35 billion.
The proudly local Tapestry group is a direct-to-consumer, vertically integrated designer, manufacturer and omnichannel cash retailer servicing customers’ sleeping and living needs. The group includes popular made-to-order furniture retailer Coricraft, South Africa’s renowned branded bedding retailer Dial-a-Bed, value bedding retailer The Bed Store and well-known home textile retailer Volpes.
Westbrooke acquired Coricraft in 2005 and since then has grown the group organically and acquisitively, from an initial 12 stores, to over 170 today across South Africa, Namibia and Botswana, with significant runway for further expansion. The group currently employs 2,500 staff and owns 3 manufacturing facilities.
“This is an exciting opportunity of scale to acquire a prominent player in the fast-growing consumer home furnishings sector while unlocking manufacturing and distribution synergies with adjacent brands in the TFG stable,” said TFG CEO Anthony Thunström.
Martin Sacks, Executive Chairman of Westbrooke Group and Chairman of Tapestry said that “the company has an outstanding management team and could not have wished for a better home than TFG. In the period following the acquisition of Coricraft we developed our business model around the business and consumer advantages and benefits of vertical integration. Over this period, it was completely contrary to the one-way traffic of offshoring manufacturing and an almost total import supply chain for consumer products in SA.”
“Tapestry created 1,000s of manufacturing, retail and support jobs and were able to offer consumers incredible value and personalisation. At the same time, we created last mile capabilities that are today highly sought after in a fast-growing online environment.” Martin Sacks, Executive Chairman of Westbrooke Group and Chairman of Tapestry
“Whilst Coricraft had a leading position in living and dining, we wanted to bring our model and capabilities to other areas of the home,” said Kevin Utian, who joined as Tapestry CEO in 2012 to lead Tapestry’s growth, and who was previously MD of Nandos. In 2014, businesses with complementary positions in sleep and bedroom were acquired, being Dial-a-Bed and Volpes.
In each core category and acquisition, the incumbent management was replaced and bolstered with talent from the wider industry who could better execute Tapestry’s vision and strategy to create specialist integrated retail leaders in their categories and markets.
Actis joined as a significant shareholder in late 2015 when Westbrooke sold a portion of its shares to them.
In the ensuing period, there have been serious macro-economic, social and political headwinds in the SA retail and manufacturing environment, including low GDP growth and a lack of fixed investment in SA, Covid and KZN riots. Throughout this period, Tapestry invested in new stores and formats, digitisation, improving efficiency in its manufacturing and distribution to deliver even better value to customers, created significant employment opportunities and made strategic bolt-on acquisitions, which led to very significant organic growth over the period. Covid starkly highlighted the value of a local and integrated supply chain which is now being widely implemented in retail globally.
Shani Naidoo, TFG Group Director for the Homeware Division noted that “The Tapestry group and its management team have implemented a unique, highly cash generative business model with excellent historic returns.”
Kevin Utian said “Westbrooke’s management have played an invaluable role in the Tapestry Home Brands’ journey. Having been associated with them from my inception in 2012, their involvement from a strategic, talent acquisition, capital allocation and financial perspective has been pivotal in both guiding and growing the Group. The Westbrooke teams’ wider network, access to capital and industry knowledge has played a significant role in building Tapestry Home Brands into the business that it is. Their ethos of building businesses through people, as well as the desire for continuous improvement, have moulded the leadership of our Group and has infused an ambition within our people that is fundamentally behind Tapestry’s success. From a personal perspective, I have benefited from the mentorship and friendship that has become the cornerstone of the Group’s culture.”
Westbrooke’s sale of Tapestry, which remains subject to competition authority approval, is illustrative of the value that can be achieved by including private market assets, especially with a long-term outlook, in well diversified investment portfolios. Not only can well managed private market investments deliver above average overall returns, they can also assist in reducing portfolio volatility through a lower level of correlation to the traditional markets.
Dino Zuccollo, Westbrooke’s head of product development and distribution, said that Tapestry’s growth and realisation events highlighted the advantage that Westbrooke creates for clients by investing alongside a team of highly experienced professionals with decades of investment experience whose core investment philosophy is focused on the preservation of investor capital and compounding returns. He said this transaction demonstrates Westbrooke’s heritage as a shareholder and operator of assets.
Westbrooke established Westbrooke Alternative Asset Management with an aim of providing investors with a unique gateway to global alternative investments, which are traditionally difficult to access, investing in easily accessible and structured funds and co-investment vehicles. Westbrooke ensures alignment by investing materially alongside investors and clients.
With in excess of R8 billion under management, Westbrooke Alternative Asset Management invests in South Africa, the United Kingdom and the United States and provides South African high-net-worth individuals, family offices and wealth managers with unique access to alternative investments in Private Debt, Hybrid Capital, Real Estate, Private Equity and Venture Capital.
