Zalando to buy rival About You in €1.1bn deal

German online fashion retailer Zalando said on Wednesday that it has agreed to buy About You in a deal that values its rival at around €1.1bn.

Under the terms of the agreement, Zalando plans to submit a voluntary public tender offer of €6.50 per share, which the board of About You intends to recommend that shareholders accept.

Zalando said that major About You shareholders Otto Group, Otto Family, Heartland and About You management have entered into binding agreements to sell their shares, which represent about 73% of the company’s share capital.

Zalando said the deal unlocks "significant" value creation opportunities in areas such as B2B, logistics, payments and commercial collaboration.

In the longer term, the German retailer is targeting "significant" group EBIT synergies of around €100m per year.

Robert Gentz, co-chief executive and co-founder of Zalando, said: "Redefining fashion and lifestyle shopping by creating the best possible experience for customers and partners has always driven both our teams. I’m excited about how together we’ll be able to cover a larger share of the fashion and lifestyle market.

"In B2C, we can offer customers and brands distinct and rich shopping experiences. In B2B, combining our complementary software capabilities, Tradebyte and Scayle, will create an even more advanced e-commerce operating system that enables brands and retailers to manage their multi-channel business across Europe and beyond."