Lumina Capital Advisers: Global And Middle East M&A Activity On The Rise, Deals Seen In High-Growth E-Commerce Sectors

Lumina Capital Advisers Limited, a Dubai-headquartered, specialist mid-market M&A firm, has announced the successful completion of a follow-on equity funding round from a consortium of regional investors into UK-based Amara Living Ltd (www.amara.com). The deal follows closely on the initial April 2020 closing and reflects the rapid growth of the Company during Q2 2020. The Lumina team, consisting of Andrew Nichol, Gareth Williams and Feico Boonstra, lead-advised the regional group of investors.

Founded in 2005 by Andrew and Sam Hood, AMARA sells over 25,000 products from a range of leading homewares brands including Missoni, Versace, and Jo Malone London. Over 50% of sales are now from international markets, mainly USA and Europe.

The company recently expanded its distribution footprint to the Middle East, which is a key growth market with strong consumer demand for online access to AMARA’s wide portfolio of aspirational homewares and curated gifts sourced from around the world.

The growth of e-commerce has been massively accelerated by the global pandemic and has attracted global, and regional, investment. A survey from Ernst & Young (EY) conducted earlier in May revealed that 92% of consumers in the UAE and KSA have changed their shopping habits, with over 50% respondents referring to ‘significant’ change.

These habits are back up by regional trends seen by AMARA. In H12020 UAE orders increased by 209% compared to the same period in 2019. KSA sales jumped by 292% during the same period. A significant factor in this growth comes from the adoption of electronic payment methods, in line with the Saudi 2030 Vision for 70% of all online payments to be cashless by 2030. In AMARA’s case the shift to Delivery Duty Paid in June 2020 helped to make online shopping as frictionless as possible for UAE and KSA customers.

In terms of regional purchasing habits, luxury gifting (a 1,834% increase) and kitchen storage and utensils (a 2,276% increase) have seen the fastest growth in sales compared to the same period in 2019. Luxury Dining (Table & Serveware +491%), Bathroom Accessories (including towels and bath robes +244%) and Decorative Home Accessories (including Cushions, and Objets d’art +238%) have also seen strong growth.

Andrew Nichol, Lumina Capital Advisers Partner said: “AMARA continues to expand its footprint across Middle East markets and its strategy of bringing in a regional partner is paying off with a rapid increase in sales across a range of products.

The family-centric market and strong gifting culture across the Middle East represents a significant customer base for homewares, while consumer demand for online access to AMARA’s wide and expertly curated products paves the way for significant expansion across the region, particularly as people spend more times in their homes due to social distancing requirements.

This deal is a great example of harnessing regional capital to help UK companies to achieve their growth ambitions, while enhancing value by opening up Middle East regional markets in a swift and efficient manner via skills, capital and talent sharing. We look forward to watching AMARA’s continued global growth as it benefits from its expanded funding lines and access to new markets.”

Andrew Hood, Managing Director, AMARA said: “We are delighted with the progress of our Middle East business and look forward to ongoing growth on the back of recent regional appointments and infrastructure and logistics investment. As the online home to over 300 of the world’s leading luxury interiors and gifting brands, AMARA’s unique position has allowed us to meet the sudden growth in consumer demand for high-end ecommerce.  Thank you to theLumina team, not only for helping us to source capital from the region, but also for finding us new partners with whom we are truly excited to work with to expand the brand’s reach across the region.”

The rationale for cross-border deals remains, in diversifying regional investors’ portfolios and bringing skills and technologies back into the region. After a nascent period due to Covid-19, companies are now preparing to market transactions in Q3/Q4 2020 and to ensure they are well financed to capitalise on regional and global recovery when it does come. As well as e-commerce, we are seeing transactions in food-tech, agriculture, industrial and distribution industries.