Frasers Group buys 18.9 percent stake in electrical retail AO

Frasers Group has made another multi-million pound investment, but this time not in a fashion business.

The group, whose growing portfolio includes Sports Direct, House of Fraser, Flannels, Jack Wills, and Evans Cycles, among others, announced Monday it has bought a 18.9 percent stake in AO World Plc, an online electrical retailer based in Bolton.

It’s an interesting move for Frasers Group, which is no stranger to buying stakes in businesses, though they’re usually ones working within the fashion industry - in the last few years alone it has bought shares of Mulberry, Hugo Boss, and N Brown.

The group has bought 109.4 million shares of AO at a price of 68 pence per share for a total investment of 75 million pounds.

It said the investment “is the culmination of productive talks over the last two years about establishing a strategic partnership”.

Chief executive Michael Murray said in a statement: “Frasers has long admired what [AO CEO John Roberts] and the AO team have built, and we are delighted to have the opportunity to form a supportive, strategic partnership.

“AO is a fantastic business with a clear strategy which is leading the market in online-only electricals.

“Through this investment, Frasers will benefit from AO's valuable know-how in electricals and two-man delivery, helping us to drive growth in our bulk equipment and homeware ranges. In turn, AO will have the opportunity to benefit from Frasers' expertise and ecosystem.”