CHAMWE KAIRA
Pepkor has entered into an agreement to acquire Shoprite’s furniture business operating more than 400 stores in South Africa, Botswana, Lesotho, Namibia, Eswatini and Zambia.
Pepkor is a South African-based investment and holding company focused on the discount and value consumer retail and fintech markets.
Pepkor’s JD Group business has recently rebranded to Pepkor Lifestyle and operates more than 900 retail stores in South Africa, Botswana, Lesotho, Namibia and Eswatini.
Pepkor said this week that over the years, it has developed leading capabilities in supply chain, logistics, and financial services, all supported by best of breed scalable integrated systems and data-driven capabilities.
Combining Shoprite Furniture with Pepkor Lifestyle will enable key synergies and efficiencies to be unlocked within the supply chain, logistics and financial services operations through leveraging improved scale, the company said.
“Pepkor Lifestyle will expand its customer base and retail footprint while integrating Shoprite Furniture operations into its existing logistics network. Pepkor’s management team has the expertise and capacity to successfully incorporate the Shoprite Furniture business into the group.”
The company said the proposed transaction will allow Pepkor to expand its value proposition through a complementary product mix in furniture, bedding, appliances and consumer electronics, while also expanding its presence in under-represented regions.
The proposed transaction includes the Shoprite Furniture credit loan book and related insurance cell captive arrangements as well as the OK Furniture and House & Home retail brands in addition to inventory and certain fixed assets.
The purchase consideration represents 4% of Pepkor’s market capitalisation and will be settled in cash.
The conclusion of the proposed transaction is subject to the fulfilment of both regulatory and commercial suspensive conditions, customary for a transaction of this nature.
“As set out in the Shoprite Annual Results, Pepkor has entered into an agreement to acquire Shoprite’s furniture business operating more than 400 stores in South Africa, Botswana, Lesotho, Namibia, Eswatini and Zambia,” the company said.
Pepkor the proposed transaction will allow Pepkor to expand its value proposition through a complementary product mix in furniture, bedding, appliances and consumer electronics, while also expanding its presence in under-represented regions.
The company added that the total consideration payable on closing of the proposed transaction will be equivalent to the net asset value of the acquired assets, subject to adjustments that may be applicable at the closing date.
“The proposed transaction includes the Shoprite Furniture credit loan book and related insurance cell captive arrangements as well as the OK Furniture and House & Home retail brands in addition to inventory and certain fixed assets. The purchase consideration represents 4% of Pepkor’s market capitalisation and will be settled in cash.”
