IT is known as the rag trade but Myer Holdings has picked up a 65 per cent stake in Australian design label sass & bide for A$42.25 million.
The transaction, announced this week, gives Myer the exclusive rights to distribute sass & bide in Australia, which will be rolled out in 30 stores over the next 18 months.
Clayton Utz has confirmed it advised Myer on the strategic acquisition, led by Melbourne corporate partner Brendan Groves. Senior associate John Brewster and lawyer Sachi Haga from the Melbourne corporate group also worked on the deal, with partners Sue Williamson and Ada Lam from the taxation team.
The sass & bide deal marks Myer's first acquisition since listing on the Australian Stock Exchange last year. The transaction is expected to complete in April.
Clayton Utz's lead partner, Brendan Groves, said the firm was pleased to have assisted Myer on a transaction of such strategic significance to the business.
"The acquisition of a stake in sass & bide is an exciting step for Myer and reflects its focus on strategic growth. We're proud to have been part of such an iconic deal," Groves said.
The deal will see sass & bide walk away from David Jones, which had a 10-year partnership with the label. David Jones said sass & bide will be "readily replaced" with "the best" local and international brands.
David Jones recently introduced 12 new designers and 18 fashion and beauty brands to its stores, in a bid to secure its position as the "home of brands".
The department stores chief executive, Paul Zahra, said on Monday the retailer had walked away because it could not justify the purchase price for sass & bide, given that sales and gross profit last financial year were down at 2005 levels.
Myer, however, said sass & bide's sales were $37 million in 2009/10, with an annual growth of 50 per cent over the past two years.