Castore raises new funds that value it at £750m
In a move that its owners claim now values the company at £750 million, HSBC, BNP Paribas and Silicon Valley Bank have provided the extra £50 million to top up an existing £25 million revolving credit facility secured in March.
Castore co-founder Tom Beahon told The Times newspaper he had been able to convince lenders to support the financing because its fitness clothing and replica kits “were relatively recession-proof”.
The added finance will give Castore the resources to build up stock to supply a recent flurry of major new partnerships where demand for consumer replica shirts escalates.
The seven-year-old business, which is backed by the billionaire Asda-owning Issa brothers, plus the founders of Pure Gym and tennis star Andy Murray, has been busy adding to its extensive roster of 10 major names in the sports world. This includes Premier football teams Newcastle United and Aston Villa in England, Sevilla in Spain, Bayer 04 Leverkusen in Germany, partnerships with the England Cricket Board and McLaren in Formula 1 motor racing.
Beahon said: “We are delighted to have successfully raised new debt facilities with three global banking partners. The increased facility is a strong endorsement of Castore’s exceptional performance in recent years, as well as our business model and strategy. The additional liquidity will allow us to further accelerate and internationalise our growth trajectory as we continue to build Castore into the leading premium sportswear brand in the world.”
Beahon also told the Times newspaper that international expansion will include “the opportunity to take the model to sports clubs in the Middle East and Far East.”
The company is currently expected to turn over £200 million in its 2023 financial year via mostly online sales, with EBITDA profits set to come in at about £20 million, Beahon said.
“Over the last three or four months, as the economy has worsened, people have focused their budgets. They’re still spending but only on things they’re passionate about. We’re selling products for sports teams whose fans are incredibly passionate.
“For team sports fans, buying their child the team’s shirt or jacket is not a discretionary purchase. Fans tended to buy the new kit at the start of the season, he said, “because every fan is convinced this is the season where things will change”.
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