Information on the Target

Tendam is recognized as Spain's second-largest apparel group by market share and stands out as one of Europe's leading omnichannel apparel enterprises. With an extensive operation comprising 1,800 retail points across over 80 markets, including Spain, Portugal, France, the UAE, and Latin America, Tendam operates well-known brands such as Women’secret, Springfield, and Cortefiel. This robust presence and diversified portfolio underscore Tendam's strategic significance in the apparel industry.

Since 2020, Tendam has consistently demonstrated robust performance, achieving steady growth quarter over quarter. By the end of January 2025, the company's total sales reached approximately €1.4 billion, highlighting a strong LTM EBITDA of €341 million post-IFRS-16. Tendam's innovative omnichannel ecosystem, paired with a loyalty-focused strategy, positions it as a pioneer in the apparel retail sector.

Industry Overview in Spain

The Spanish retail industry, particularly the apparel segment, is characterized by a progressive shift towards omnichannel retailing, driven by changing consumer preferences and technological advancements. The sector showcases a mix of traditional retail and digital sales platforms, emphasizing flexibility and adaptability. Notably, the pandemic has accelerated the evolution of shopping habits, with a significant increase in online transactions complimenting physical store operations.

Spain's retail market has a significant economic footprint, contributing to a sustained recovery post-pandemic. The country has witnessed a growing demand for apparel that is both fashionable and accessible, indicating a shift towards premium mass market segments. Brands offering omnichannel experiences have outperformed traditional retailers, reflecting the industry's inclination towards integrating online and offline shopping experiences.

As of now, the apparel market is valued substantially, estimated around €1.3 trillion globally, indicating vast potential for expansion in both European and emerging international markets. Retailers that successfully harness technology to enhance customer experiences are positioned favorably for growth in this competitive landscape.

Furthermore, the transition towards sustainable fashion and responsible sourcing adds an additional layer of complexity and opportunity in the market. Companies that prioritize environmental responsibility and transparency in their supply chains are increasingly attractive to consumers, influencing the purchasing behavior across demographics.

The Rationale Behind the Deal

The investment in Tendam facilitates Multiply Group's strategic objective to penetrate the retail and apparel sector, marking a pivotal entry into a valuable market. By acquiring a controlling stake of 67.91% in Castellano Investments S.À R.L., the parent company of Tendam Brands S.A.U. and its subsidiaries, Multiply Group aims to steer the next phase of Tendam’s growth focusing on international expansion and further enhancing its omnichannel capabilities.

Multiply Group’s investment also aligns with its overarching goal of fostering growth in consumer-focused sectors, leveraging Tendam's established brand equity and international presence. This deal represents a natural progression in Multiply Group’s portfolio, reinforcing its commitment to achieving double-digit EBITDA growth and expanding its global footprint.

Information About the Investor

Multiply Group PJSC (ADX: MULTIPLY) is an investment holding company based in Abu Dhabi, focused on diversifying its operations across multiple sectors including Mobility, Media and Communications, Energy and Utilities, and Beauty and Wellness. The company has recently engaged in extensive investment activities, deploying approximately AED 1 billion in the acquisition of several enterprises, signifying a robust commitment to growth across varied industries.

With a strategic focus on enhancing its investment portfolio, Multiply Group has demonstrated strong performance across key metrics, with a notable 56% year-on-year revenue increase in 2024, surpassing the AED 2 billion threshold. This consistent growth is indicative of the company's effective investment strategy and its ability to capitalize on market opportunities while strengthening its position in pivotal sectors.

View of Dealert

The acquisition of a majority stake in Tendam by Multiply Group can be viewed as a strategic and potentially lucrative investment. By securing a foothold in the omnichannel apparel market, Multiply Group not only diversifies its portfolio but also positions itself in a high-growth sector that is currently witnessing significant trends in consumer behavior towards online and hybrid shopping models.

As Tendam continues to excel in establishing a unique omnichannel ecosystem, the backing from Multiply Group could facilitate accelerated growth and international expansion. Their combined capabilities and aligned visions present a promising horizon for significant returns on investment, especially considering Tendam's current trajectory of growth and market demand.

However, market dynamics such as shifting consumer preferences and the need for sustainable practices pose challenges that require vigilant management. Multiply Group will need to leverage its expertise in overseeing Tendam’s operations to navigate these complexities effectively while ensuring continued success in the retail space.

Overall, this acquisition not only reflects Multiply Group's broader growth strategy but also underscores its confidence in Tendam's ability to thrive in an evolving market landscape. With unified efforts from both the management teams, this investment has the potential to yield favorable outcomes for stakeholders in the coming years.

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