Majestic sale completes as scale of original proposed closures revealed

Majestic has confirmed that the 140 stores that had been earmarked for closure under the previous owners will all remain open following its acquisition by Fortress Bank.

John Colley, chief executive of Majestic

The announcement by the wine specialist came this morning following the completion of the sale to Japanese-owned US firm Fortress Investment Group LLC, for £95 million.

It shows the extent of the former owner, Naked Wines, plans to strip Majestic of its assets  – cutting the store estate by almost two thirds – in order to concentrate of Naked’s digital business, primarily in the US. In the end, only one store out of nearly 200, was sold separately to developers, with Majestic being given the option to have retail space in the new 25-storey development in Ealing.

Speaking to the drinks business last month as it revealed its new range, returning executive chairman Colley, who was managing director of the UK retailer between 2015 and 2017 said the retailer was “getting back to what we do well”, and that a combination of stores, online and direct mail was the key to future growth.

“They [Fortress] see it as a bricks and mortar retails with an online arm, not a web business with some shops, which is where I think Rowan [Gormley] was intimating it was going,” he said. “We are committed to our retail structure and physical space, but we need a format strategy that is relevant for the future, so we will look at new sites… whether that’s the same size of smaller of different.”

The majority of the retailers business still goes through the store network, he said – and the company is opening a new store in Blackheath – although the online business was growing “nicely” and channel shift was happening “naturally’.

The business had come out of a “very difficult period”, Colley said, but believed its biggest assets was its people and store network.

“The question is how do we get them working well with each other to generate growth?” he asked. “How it works together is what is important and that’s what we’ve got to get right.”

Old favourites

Majestic is also bringing back old favourites that had been taken out of the range in previous years, he said, and the company announced today it was asking its customer base to send in requests with the wines they want to see on shelves.

The buying team has already brought in around 2 million more bottles to see it through Christmas and Brexit in January, with a promotional platform aimed at boosting its busiest time of the year.

“It gives energy to our colleagues in store and if we come out with a great set of results, it’ll put us in a great position for the New Year,” he told db.

There was, he added “strategic opportunity” for Majestic to ensure that the range was “significantly different to those in the supermarkets” under its new buying & merchandising director, former Tesco BWS boss Rob Cooke.