Ethel Austin sold to VCs for £120m

Discount fashion retailer Ethel Austin is poised for growth after venture capitalist ABN AMRO Capital snapped up a majority stake in a£122.5 million deal.

The retailer's management team has pledged to stay and reinvest in the business. Chief executive Phil Hoskinson, retail director Ray Carroll, trading director Sue Tennant and financial director Steve Williams now own 37 per cent of the company's shares.

Lloyds TSB Development Capital, which backed the retailer's£55 million MBO in June 2002, sold its majority holding, but reinvested£5 million to buy a 7 per cent stake.