Kogan’s most notable past acquisitions have been replica furniture retailer Matt Blatt, which it acquired for $4.4 million in May, and the digital assets of collapsed electronics retailer Dick Smith, which it snapped up for $2.6 million in 2016.
With numerous businesses struggling amid the coronavirus pandemic, Kogan told shareholders there were “multiple opportunities” presenting themselves, but the business would focus on acquisitions which expanded Kogan’s customer base or broadened its offering.
“Kogan.com is committed to making the most in-demand products and services more affordable and accessible,” chief executive and founder Ruslan Kogan said.
“We are now in a better position than ever to take advantage of growth opportunities. Our low cost of doing business and digital expertise have put us in the driver’s seat to capture market share as the retail industry undergoes significant change.”
Kogan’s revenue soared as more and more customers began to shop online during the pandemic and is now up 35.1 per cent to $674 million for the financial year to date. Earnings have similarly increased, coming in at $41.8 million for the same period, a 54 per cent rise.
This sales performance has boosted the market capitalisation of the retailer to $1.2 billion, making it worth as much as the combined value of Myer and David Jones, two of Australia’s oldest and most well-known retailers.
Shareholders have lauded the company’s 6 per cent cost-of-doing-business to sales ratio as one of its greatest strengths, with analysts claiming it is “one of the most efficient retailers in Australia”.
Mr Kogan and chief financial officer David Shafer are not able to participate in the $100 million placement, but both will take up their full entitlements in the $15 million share purchase plan. The duo, who founded the business, own 22 per cent and 8.5 per cent of the retailer respectively.