{"id":452052,"date":"2020-11-26T10:48:59","date_gmt":"2020-11-26T08:48:59","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=452052"},"modified":"2020-11-26T10:48:59","modified_gmt":"2020-11-26T08:48:59","slug":"mr-price-buys-value-fashion-retailer-with-170-stores","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/trending\/452052\/mr-price-buys-value-fashion-retailer-with-170-stores\/","title":{"rendered":"Mr Price buys value fashion retailer with 170 stores"},"content":{"rendered":"<p>Mr Price has concluded an agreement to acquire high performing value retailer, Power Fashion, which currently has 170 stores across Southern Africa.<\/p>\n<p>Reuters analysts peg the acquisition value at around <a href=\"https:\/\/www.nasdaq.com\/articles\/s.africas-mr-price-to-buy-local-retailer-despite-hy-profit-slump-2020-11-26\">R1.6 billion<\/a>.<\/p>\n<p>Power Fashion was founded in the 1950s and is a high growth, family-owned apparel retailer based in Durban, South Africa. It is value-focused and cash-based, servicing low to middle-income households.<\/p>\n<p>It offers merchandise for the family, retailing largely apparel merchandise but also offering cellular products, basic household items, value cosmetics, electricity and other opportunistic products.<\/p>\n<p>\u201cMr Price and Power Fashion share a similar set of values which makes this acquisition a great fit,&#8221; said Mr Price chief executive, Mark Blair<\/p>\n<p>&#8220;Power Fashion was built on a similar entrepreneurial mindset to Mr Price and also offers exceptional value to its customers. We both have high-performance cultures and are equally focused on strategic growth.<\/p>\n<p>&#8220;Our sufficiently differentiated business models and target customers will enable strong positioning in both the deep-value and fashion- value segments of the market. We are pleased that we will provide immediate returns to our shareholders, as well as continue to deliver on our respective promises to our customers.&#8221;<\/p>\n<p>In Power Fashion, Blair said that the group will acquire a business that meets each of these closely researched criteria:<\/p>\n<ul>\n<li>Value focused business that predominantly trades in cash and is aligned to the group\u2019s core capabilities;<\/li>\n<\/ul>\n<ul>\n<li>Fits within the group\u2019s capital allocation strategy and is bolt-on in nature (the size of the transaction is approximately 4% of market capitalisation);<\/li>\n<\/ul>\n<ul>\n<li>High performing business with a strong track record, eliminating the need for any turnaround strategy and avoiding the associated management distraction and integration costs;<\/li>\n<\/ul>\n<ul>\n<li>An existing business of attractive scale which is available at a reasonable valuation. Immediately earnings\u00a0 \u00a0accretive and not dependant on synergies;<\/li>\n<\/ul>\n<ul>\n<li>Opportunity for significant future growth in footprint and categories;<\/li>\n<\/ul>\n<ul>\n<li>Low risk as opposed to acquiring an unknown territory with additional foreign exchange risk;<\/li>\n<\/ul>\n<ul>\n<li>Strong management and skilled team to prevent distraction and ensure continuity.<\/li>\n<\/ul>\n<hr \/>\n<p><strong>Read: <a href=\"https:\/\/businesstech.co.za\/news\/business\/452016\/mr-price-highlights-7-post-lockdown-trends-in-south-africa\/\" target=\"_blank\" rel=\"noopener noreferrer\">Mr Price highlights 7 post-lockdown trends in South Africa<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Mr Price has concluded an agreement to acquire high performing value retailer, Power Fashion, which currently has 170 stores across Southern Africa.<\/p>\n","protected":false},"author":10,"featured_media":452058,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[26,2910,15582],"class_list":["post-452052","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-trending","tag-headline","tag-mr-price","tag-power-fashion"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/452052","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=452052"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/452052\/revisions"}],"predecessor-version":[{"id":452070,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/452052\/revisions\/452070"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/452058"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=452052"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=452052"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=452052"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}