| Mon 1 Jul 2002, 0:00 | | EDGARS CONSOLIDATED STORES LIMITED - PRESS RELEASE |
|
("Edcon")
JSE code : ECO
ISIN code : ZAE000018388
Press Release
Edcon announced today an agreement with Elixir Marketing (Pty.) Ltd.,
trading as "Super Mart", for the purchase of their retail business. The
agreement is subject to due diligence and Competition Board approval.
Super Mart is a discount general merchandise cash retailer serving middle
and lower income consumers in seven locations, most of them in Gauteng.
This acquisition is consistent with Edcon`s stated strategy to become a
dominant force in discount and to enhance its relevance to 20 million plus
consumers. There will be an initial cash payment of R70m with further
amounts payable on an earn-out basis over the next three years.
Steve Ross, CEO of Edcon, said "Super Mart complements our United Retail
offering and provides synergies in areas such as marketing, procurement,
real estate and other group services for both Super Mart and Edcon."
Ian Fuhr, MD of Elixir Marketing, said the sale of Super Mart to Edcon "will
facilitate and accelerate our store and geographic expansion plans and
provides further career and development opportunities for our employees,
whom we have always considered our greatest asset."
United Retail currently includes Jet, Sales House, Cuthberts and Smileys and
collectively represents about 10% of the South African market for apparel
and footwear. The Sales House and Jet brands rank 2nd and 3rd respectively
in the SA market according to the latest Markinor brand survey.
Super Mart is a privately held discount general merchandise retailer
operating since 1988. Five stores carry the full product range and vary in
size from 2900m2 to 6500m2. The product mix includes home, kitchen and
tableware, music, DIY, small electrical appliances, blankets, linens,
schoolwear, luggage, stationery and some apparel. The other two stores
carry music and a narrower product range.
Ross added "the assimilation of Super Mart into the Edcon operation will be
gradual, thus providing for the continuity and skills of their very talented
team. The current Super Mart management and employees will remain in place
to run and grow the business."
The final purchase price will depend on the due diligence and future
earnings, but preliminary projections indicate the deal will be earnings
positive for Edcon from the first year. A further announcement will be made
shortly.
On behalf of Edcon :
M. R. BOWER, Chief Executive - Group Services (011) 495-6411
J. A. DAY, Chief Strategy Officer (011) 495-1031
Date: 01/07/2002 09:31:49 AM Produced by the SENS Department
