Terms of the transaction were not disclosed. Debt was provided by Germany’s
Founded in 1999, Dress-for-Less operates several full-price online shops for fashion brands and in addition sells end-of-season designer clothing. The business offers a range of more than 4,000 items and has enjoyed grown in excess of 30% per year since launch.
Dan Mytnik, a partner at Palamon, told TMN that the value of the business was in market growth. “About 8% of all apparel was sold over the internet in the US in 2006 and penetration in Europe is around 5%, so there is a gap that is going to close over time,” he said. “The online slice of apparel has significant growth ahead in the next few years, so that’s one trend we’re tapping into.”
Mytnik added that Dress-for-Less also stood out by focusing on the “multi-brand deep discount area” rather than full-price branded owners. He said that Palamon would focus on building the core German business and more specifically on a smaller selection of European countries that the business sells to.
In October, TA Associates acquired M and M Direct, an online discounted apparel and footwear retailer.
Dress-for-Less is Palamon’s ninth investment from its second fund, Palamon European Equity II, which raised €670m in 2006. Other German investments include Loyalty Partners, Moviepark Germany and Cadooz.