PETALING JAYA: Khazanah Nasional has stepped forward to explain its recent divestment from FashionValet Sdn Bhd, following an apology issued by the two founders of the fashion company.
In a statement yesterday, Khazanah said it had paid RM27mil to secure a 9% stake in what it called a “burgeoning homegrown e-commerce platform boasting over 400 brands and 15,000 products, with expectations of achieving approximately 60% annual revenue growth”.
“Our investment rationale was anchored on the theme of offline-to-online e-commerce, as well as a commitment to support Malaysian entrepreneurs and promising early-stage companies,” it said.
The government-linked investment company added that, however, FashionValet faced numerous challenges over the years, exacerbated by the Covid-19 pandemic, which hindered its platform expansion.
“This required FashionValet, under the guidance of its board of directors and shareholders, to shift focus from being an e-commerce platform for South-East Asian brands to growing its wholly-owned in-house brands, Duck and Lilit, in order to preserve the company’s operating margins and cash flow,” it said.
Additionally, FashionValet took steps to rationalise costs and streamline operations but continued to struggle with securing capital amid a difficult fundraising climate from 2022 to 2023, Khazanah explained.
In late 2023, NXBT Partners, led by an experienced Malaysian entrepreneur, offered to acquire existing shareholders’ stakes and infuse capital into FashionValet.
“In view of FashionValet’s urgent need for funds to continue operations, and the fact that the investment had reached the end of its targeted holding period, Khazanah considered and accepted the offer.
“The divestment represented a responsible exit to transfer ownership to a party who could help guide the company to a new growth trajectory,” the statement read.
Khazanah’s statement came after Datin Vivy Yusof and her husband Datuk Fadzaruddin Shah Anuar issued an apology over the controversial sale of FashionValet and announced that they were stepping down from their positions in the company.
On Tuesday, the Finance Ministry said in a written parliamentary reply that Khazanah and Permodalan Nasional Bhd (PNB) had sold their collective stakes in FashionValet for RM3.1mil, after having paid RM47mil for the investment.
Both entities accepted the offer by NXBT Partners as a “strategic exit” from the company, the ministry said.
