NAB’s private equity arm invests in Queensland retail group WOW Sight & Sound

The banks might not be lending, but at least they are putting some money to SMEs. Queensland retailer WOW Sight & Sound has received a “substantial” from National Australia Bank’s private equity arm, National Australia Bank Integrated Capital Solutions (NAB ICS).

While the size of the investment and NAB ICS’s stake in the business has not been disclosed, WOW retail director Con Nicolas says WOW Group’s management team, lead by managing Director Sam Savvas, retains majority control and NAB’s stake is far less than 50%.

NAB ICS will have one non-executive director on the company’s board.

“Their involvement is welcome,” Nicholas says. “One of the reasons we partnered with NAB is what they bring to the table is a lot of expertise.”

“We had quite a few other options but the package that NAB presented to us suited our needs… particularly in terms of future growth.”

WOW currently operates 15 stores, with two thirds located in Queensland, two in regional New South Wales, one in regional Victoria, one in Canberra and one in Darwin.

The company now plans to open 25 stores in the next three years to take its total footprint to 40 stores.

Nicolas says the biggest challenge will be finding sites, although this may actually be easier for WOW than it has been in the past.

The company’s traditional focus has been property development, which meant that it has concentrated on owning and developing freehold sites, rather than just leasing existing properties.

Nicolas admits that this strategy has slowed down the chain’s growth, but says the shift to a leasing strategy has already resulted in a sharp increase in opportunities.

“We try to choose what we call Mayfair sites – high profile sites – and not everyone wants to sell those sites for development. But now we are moving to leasing strategy, developers are rushing to talk to us. It’s opened up the floodgates.”