The Warehouse Group Sells Torpedo7 to Tahua Partners for just $1

The Warehouse Group has finalised the sale of its outdoor retail brand, Torpedo7, to Tahua Partners Limited for $1. This investor consortium includes Paul and Liz Blackwell, known for their former ownership of the Breakers basketball team. The Warehouse Group's investment to date in Torpedo7 has totalled $52.2 million, involving a 51% stake acquisition for $33 million over three years, and a further 29% for $15.2 million in March 2014.

Transaction Snapshot

  • Deal value: $1
  • Deal type: Acquisition
  • Investors: Tahua Partners

The transaction includes Torpedo7's assets, obligations, and the majority of its staff, who will be offered positions by the new owner. Tahua Partners will take over the brand, stock, cash in store, and assume responsibilities for leases, gift cards, online orders, and customer returns.

This sale comes after Torpedo7 experienced a 25% drop in first-quarter sales and an operating loss of $22.2 million for the year ending July 2023, making it The Warehouse Group's least profitable brand. The Warehouse expects a non-cash, pre-tax accounting write-down of $55 million to $65 million in its FY24 half-year income statement due to this sale.

Nick Grayston, CEO of The Warehouse Group, emphasised the decision's strategic rationale, allowing the company to concentrate on its core brands and improve financial performance. Torpedo7 accounted for only 5% of group sales, prompting a reevaluation of resource allocation towards more profitable segments.

Tahua Partners expressed delight in acquiring Torpedo7, viewing it as a complementary addition to their portfolio of retail and hospitality brands. This acquisition aims to revitalise Torpedo7 by leveraging Tahua's retail expertise.

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