Online retailer Kogan has purchased the assets of furniture retailer Brosa for about $1.5 million. Brosa had reportedly posted annual sales of over $50 million before it went into administration last week.
In addition to its stock and intellectual property, which it will now own, Kogan will also provide support to Brosa’s customers.
Founded in 2014, Brosa was able to build a following among high-end consumers. It offers a wide range of home goods, including three-seater white couch and vintage rugs.
It was backed by venture capital firms which helped fund the marketing and brand building of Brosa. The valuation of Brosa increased by 49 percent in the past few months due to its solid trading performance.
Due to the pandemic, the demand for home goods retailers started to decline. As a result, Brosa was placed in administration.
Brosa is in a relatively mature online furniture market that includes similar reatilers such as LivingStyles. You can save at Livingstyles with a LivingStyles coupon.
In its filings with the Australian Securities Exchange, online retailer Kogan noted that Brosa was valued at about $60 million. It had also experienced strong revenue growth during the previous financial year.
The administrator of Brosa said that the company received over 30 expressions of interest. After considering the various bids, it was decided that the online retailer would purchase the business.
It’s a small acquisition for the Kogan, which has a market capitalization of around $350 million. During the September quarter, its gross sales were $202.3 million, which was 38.8 percent lower than the previous year.
The acquisition of Brosa was relatively low-risk for both parties. It also allows Kogan to expand their online furniture offerings.