From a network of franchising outlets to a fully integrated retail business

Case MQ 


In 2006, MQ was a retail chain of high-end men’s and women’s high-end fashion, consisting of a franchising network of 45 independent retailers with over 100 outlets around Sweden. The company’s sales were growing but, due to its complex ownership structure, managing growth had become a challenge. MQ was searching for a private equity investor to acquire all of its outlets and its shared marketing business with an objective to transform the company to a fully-integrated retail business and to improve its efficiency.  

MQ’s profiling and strong market position made it an attractive investment

In 2006, the fashion retail market was experiencing solid growth. MQ showed’s good profitability and, due to its profiling, it was safe from the wide fluctuations related to the economic cycles typical of the clothing industry. In addition, MQ was one of the most popular Swedish clothing chains and it was growing steadily at 10% a year. According to analysts, MQ’s brand was in rude good health, the stores were in excellent locations, and both sales and earnings came in well above the average for the each branch. Furthermore, MQ’s comprehensive clothing offering had a good balance between well-known branded fashion gear and MQ’s own brand, addressed to at young fashion-conscious adults who would not be the first to compromise on looking fashionable despite hard economic times. The company’s skilled and experienced management and good profitability created an excellent base for further growth.

Value creation during CapMan’s ownership

During CapMan’s ownership, MQ’s sales were boosted by increasing the size of individual outlets and by opening new stores: the store count increased from 86 to 106 in four years. In addition, MQ’s efficiency was further improved by concentrating all the purchases through a central warehouse and optimising the sales mix by expanding sales of MQ’s private labels, which had better margins than other branded garments, and as well as bringing items into the retail channel quicker by improving logistics. Furthermore, the organisational culture was strengthened and the company had brand new common values to be implemented across all stores. Central administration and appropriate reporting and accounting practices, missing from the previously fragmented company, were set up. Together with the company’s management, CapMan substantially strengthened MQ’s competitive edge and corporate culture and provided a solid platform for continued profitable growth.

In 2010, MQ was in good shape and ready to be listed on the Stockholm Stock Exchange, as planned already in the investment phase. CapMan sold its remaining 28% stake in 2013, after which MQ has continued its journey as one of Sweden’s leading fashion retailers. By the end of 2015, MQ was trading at a 45% premium compared to its initial issue price in 2010.

We are convinced that the public listing will support the company in executing its Nordic expansion strategy

“CapMan became the major owner of MQ in 2006, and the company has developed positively during our ownership period. After four years of active development work we believe that MQ is now well-placed as a fully integrated retail chain. We are convinced that the public listing will support the company in executing its Nordic expansion strategy. We are also very pleased to report that the interest for MQ has been strong, both in Sweden as well as internationally,” says Göran Barsby, CapMan Partner and a member of MQ’s Board of Directors at exit in 2010.

Key facts:

Investment period: 2006-2010

CapMan funds’ ownership (diluted): 58%

Exit: IPO

Case team: Göran Barsby, Markus Sjöholm

Investment: 2006

Turnover: 161,812,403 e

Personnel: 1050

Reporting year: 2011


Net sales development
SEK million

SEK million