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Voluntary Announcement relating to the Acquisition of certain businesses from Retailability
Pepkor Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number: 2017/221869/06)
Share code: PPH
Debt code: PPHI
ISIN: ZAE000259479
LEI: 3789006D677C34F69875
("Pepkor", the "company" or the "group")
VOLUNTARY ANNOUNCEMENT RELATING TO THE ACQUISITION OF CERTAIN BUSINESSES FROM RETAILABILITY
1. INTRODUCTION
Pepkor shareholders and noteholders are hereby advised that the company has entered into a
transaction agreement with Retailability Proprietary Limited ("Retailability") to acquire the Legit,
Swagga, Style and Boardmans businesses (the "Proposed Transaction").
Retailability is a privately owned retail group that offers affordable apparel and lifestyle products
across a number of retail brands in southern Africa. The businesses to be acquired operate 462
stores across South Africa, Botswana, Lesotho, Namibia and Eswatini. The Proposed Transaction
is subject to the conditions precedent as detailed in section 3 below.
The Edgars, Edgars Beauty, Red Square, Kelso and Keedo businesses are not included in the
Proposed Transaction and will continue to be operated by Retailability.
2. RATIONALE FOR THE TRANSACTION
The group has previously stated its intention to expand its market share in adultwear through
organic and acquisitive growth strategies. This is based on the group's underindexed market
position in adultwear categories compared to its dominance in babies', kids' and school wear. The
launch of the new Ayana womenswear brand in 32 stores at the end of February 2025 and recent
acquisition of Choice Clothing are further examples of the group's adultwear growth strategy.
The acquired businesses will be incorporated into the Pepkor Speciality business unit. Pepkor
Speciality provides a range of adult apparel, footwear and accessories across seven retail brands,
including Tekkie Town, Shoe City, Dunns, Refinery, CODE, SPCC and Ayana. Pepkor Speciality's
total store base comprises 941 stores across South Africa, Botswana, Lesotho, Namibia and
Eswatini.
The Proposed Transaction will add significant additional scale to Pepkor Speciality and expand
its product offering in the adult market, especially in womenswear through the Legit brand.
The acquisition of Swagga and Style has strong synergistic benefits, expanding the group's store
portfolio and providing the opportunity to further grow the group's share in the adult wear market.
The Boardmans online brand, which operates in the homeware product segment, will become
part of the Pepkor Lifestyle business.
Pepkor will unlock value through its extensive scale in sourcing, supply chain and back office
functions, in addition to leveraging its capabilities in credit and other financial services.
Tyrone Vieira, CEO of Pepkor Emerging Businesses commented: "We are excited to welcome
the Legit and other Retailability businesses into Pepkor Speciality, forming an integral part of our
strategy to grow our market position in adult wear. These businesses are a natural fit for Pepkor
Speciality and we are looking forward to integrating them and unlocking benefits from the added
scale."
Pepkor's COO, Sean Cardinaal, stated that the acquisition of these businesses "represents a
major milestone in the execution of Pepkor's strategic growth model by accelerating growth in the
group's Traditional Retail core. This, in turn, will enable strategies in our other growth pillars of
Financial Services & Connectivity, Omnichannel, and Leverage & Efficiency – contributing to
Pepkor's delivery of compelling and sustainable long-term performance and returns."
3. PRINCIPLE TERMS OF THE PROPOSED TRANSACTION
The total purchase consideration payable on the closing of the Proposed Transaction, which will
be subject to relevant net working capital adjustments, represents less than c. 2% of Pepkor's
market capitalisation. The purchase consideration 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.
4. CLASSIFICATION OF THE PROPOSED TRANSACTION
The Proposed Transaction is not a categorised transaction in terms of the Listings Requirements
of the JSE.
An investor presentation is available on the Pepkor website: www.pepkor.co.za and any questions
can be directed to: investors@pepkor.co.za
Parow
25 March 2025
Equity and debt sponsor
Investec Bank Limited
Financial advisor and Corporate Broker to Pepkor
Rand Merchant Bank (a division of FirstRand Bank Limited)
Legal advisor to Pepkor
ENS Africa
Legal adviser to Retailability
Cliff Decker Hofmeyr
Date: 25-03-2025 07:45:00
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