Pepkor, the continent’s largest clothing retailer, is reportedly contemplating a takeover bid for South African competitor, Edgars, say insiders privy to the discussions. Pepkor, which boasts chains such as Pep, Tekkie Town and Ackermans, is believed to be weighing up a potential offer of up to R2.4 billion for the 94-year-old brand. Three years ago, Edgars was purchased from business rescue by Retailability.
While the discussions could still break down or another buyer could appear on the scene, a successful deal would give Pepkor an additional 131 stores, enhancing the company’s concentration in women’s apparel and cosmetics. Pepkor CEO, Pieter Erasmus, remarked that while they maintained a focus on organic growth, the company was keen on adding more adult clothing to their portfolio and would consider a purchase if the price was right.
There has been no official comment from Pepkor regarding the potential Edgars purchase. In response to inquiries, Retailability CEO, Norman Drieselmann, said, “Private equity is always open to opportunities, but there is no deal to sell Retailability or Edgars at present.”
The negotiations occur amid increasing competition in the discount clothing sector, following The Foschini Group‘s successful revamp of Jet, a local rival. TFG acquired Jet in 2020 from the administrators working to salvage Edcon Holdings Ltd. from bankruptcy. Edcon had ownership of both Jet and Edgars chains.
Meanwhile, Pepkor is also growing its presence in Brazil by investing in Grupo Avenida SA, marking its first move into South America. The company’s shares have dipped 5.1% this year as it grappled with fashion missteps at its flagship Ackermans unit.
