Wehkamp looks into IPO

Wehkamp, the online department store from the Netherlands, is looking into an initial public offering (IPO). Their largest shareholder Apax wants to leave the company. An attempt to sell the retailer privately fell through.

Wehkamp has been in the hands of English private equity firm Apax since 2015. The company tried to sell earlier this year but failed, sources told Dutch newspapers. By preparing to go to the stock market, Wehkamp follows in the footsteps of Coolblue and Bol.com. The two biggest online stores in the Netherlands announced their plans for public offering as recently as last week.

Gross profits more than doubled in 2020

The news comes at a time when Wehkamp is flourishing. In 2020 revenue increased 22 percent to 730 million euros, and gross profits were up almost 250 percent to 57 million euros. The company also bought an online shop for kid’s fashion and opened a new distribution center recently.

In 2020 gross profits were up almost 250 percent.

But the retailer’s plans for public listing are not without doubt. Due to pandemic lockdown measures, online shopping as a whole was booming. The question is if Wehkamp will continue to thrive when the pandemic boom in ecommerce dies down.

Pre-pandemic numbers raise doubts

After all, Wehkamp has had a tumultuous few years. This past June the company broke ties with its financial arm Tinka (formerly Lacent), which accounted for around 8 percent of its revenue. In 2018 the company’s numbers were around 28 million euros in the red. The year before the pandemic hit, their losses were over 17 million euros.

Wehkamp was over 17 million euros in the red in 2019.

A possible reason for these losses is the company’s high return rates. Wehkamp’s best selling category is clothes, which are infamous for being sent back. In 2016 the company revealed that 30 percent of its orders were returned. For a website that also sells furniture and household items, the steep return rate makes for high costs.

Wehkamp follows Bol.com and Coolblue IPO plans

Wehkamp is the third Dutch company revealing plans for a public offering this fall. Only last week Bol.com, the number one online store in the Netherlands, announced a public listing for late 2022. Omnichannel retailer Coolblue planned to go public last month, but postponed it for a second time due to conflicting valuations of the company.

Bol.com is almost three times the size of Wehkamp.

Bol.com and Coolblue have ranked as the top two online retailers in the Netherlands for years on end. To illustrate: in 2020 revenues, Bol.com is almost three times the size of Wehkamp. Combined with fluctuating company results, it remains to be seen if majority shareholder Apax can appeal to investors.