Chilli is a retailer of furniture, such as sofas, dining suites and garden furniture, with 23 retail stores in Sweden and a strong online presence. In a relatively weak retail market, Chili managed to grow by 19% annually between 2010 and 2014, reaching a turnover of SEK 324 million. In 2015, the company was acquired by the e-commerce company Bygghemma, creating one of the largest online furniture stores in the Nordics.
Despite a history of strong growth, Chili, based in Gothenburg, was experiencing problems with profitability. This led to Bygghemma acquiring parts of the company in 2015.
“We have kept an eye on them, as we do when we’re looking at potential acquisitions”, says Mikael Olander, CEO at Bygghemma.
By acquiring Chilli, Mikael Olander expects Bygghemma to reach a turnover of nearly SEK 2 billion with a positive operating margin. One billion will come from construction and almost one billion from the furniture and interior side of the company. If achieved, it means Bygghemma has gone from a turnover of SEK 270 million to SEK 2 billion in three years.
Bygghemma is owned by Ax:son Johnsons investment company, Nordstjernan.
“Nordstjärnan is a very strong owner. If we agree on what acquisitions to make, we can make them”, says Mikael Olander.