In a pre-pack agreement, ScS has acquired Snug from administration for just £875,000 with the intention of integrating the brand’s concession into its retail locations.
In the transaction, UK financial services company Evelyn Partners served as administrator, and Snug’s brand, domain names, website, intellectual property, and shares were acquired by the furniture behemoth. All jobs are to be preserved.
Snug, the first sofa-in-a-box company in Europe with the modular and reconfigurable furniture available in a variety of colours, was founded in 2018. It is well known for its quick shipping, creative product design, and adaptability to any home.
Revenues for the company exceeded £30 million in 2021, up from £7 million the previous year. As a result of being a digital-first business, the brand has amassed a social media community of over 300,000 users and won numerous professional accolades.
Snug was confronted with adverse market conditions against the backdrop of a terrible economic environment, in spite of having lofty objectives and expansion plans for 2022. Specifically, a 700% increase in transportation expenses, unfavourable currency exchange rates, and new consequences of the cost of living problem did for the business.
With around 1,900 employees in the UK, ScS is one of the biggest dealers of upholstered furniture and carpets. The chance to further grow market share is offered by the acquisition.
As per the agreement, Snug’s website and its pop-up shop in Leeds will carry on running with as little interruption as possible.
“It has been a rollercoaster few years handling exponential expansion with supply chain problems and expanding a workforce remotely through Covid,” said Snug’s management in a statement.
“With quick and convenient delivery of modular couches, Snug set out to revolutionise the market. This new relationship with ScS helps us achieve our goal of becoming the market leader. Since the beginning, our success has been built on the devoted client base of Snug. We now look forward to continuing this adventure with their support as well as the assistance of such a well-known and reputable partner.”
Chief executive officer of ScS, Steve Carson, said: “Snug is a promising young company with a lot of potential. It targets a market that is complementary to our offering, has a strong and recognisable brand, and a product that is unique. In that aspect, it offers us a fascinating chance to further grow our market share.
“As a result, we see it as a fantastic strategic and cultural match that strengthens our dedication to assisting our clients in building the home they love. We eagerly await the addition of our new colleagues to the ScS family.”
The announcement comes after Made.com, which floated on the London Stock Exchange in 2021, went into administration and was acquired by retail giant Next in November 2022.