Mosaic Brands has placed online-first, trans-Tasman retailer EziBuy into administration, proposing a restructure.
Mosaic acquired half of the EziBuy business in late 2019 in a rescue deal, and a year later bought the balance for $11 million, looking to fuel the group’s online growth.
Although profitable in FY21 and FY22, the group noted that the “performance of EziBuy has been at odds” compared with the retailer’s omnichannel brands.
Furthermore, the return to in-store shopping post-lockdowns impacted EziBuy’s sales resulting in a 51 per cent fall in the first half of this financial year, compared to the previous year.
“The extent of EziBuy’s sales decline, particularly in the context of the group’s wider positive portfolio of online performance, prompted the board to conduct a strategic review of its operations and cost structure,” said the company in an ASX statement.
The retailer has proposed a “restructure” to the administrators in a bid to turn the brand into a “simplified, profitable, cash-generative online-only operation”.
“The board believes this process to restructure EziBuy is in the best interests of the group’s shareholders as it will improve the group’s overall net asset position and operating cash flow.”
The group’s other retail brands are unaffected by EziBuy’s predicament.
Back in 2021 EziBuy generated about NZ$135 million of revenue, of which over 80 per cent was through its digital platform. The company’s roots date back to a New Zealand mail catalogue business.
