The Competition Commission has cleared Pepkor’s takeover of four fashion brands as well as homeware and décor brand Boardmans from Edgars owner Retailability.
The deal, with an estimated value of R1.9bn, is expected to expand Pepkor’s store portfolio, sharpen its edge in the adult apparel market and create opportunities to consolidate sourcing, logistics and e-commerce capabilities across the group.
The brands — Legit, Style, Swagga, Beaver Canoe and Boardmans — generated about R2.4bn in revenue in the 2024 financial year across 462 stores in SA, Botswana, Lesotho, Namibia and Eswatini, according to Pepkor.
The Ackermans and Pep owner said the acquisition will add 337 SA stores and 125 stores in neighbouring countries to its clothing and general merchandise division, taking the group’s total store base to about 7,000.
It will also give the company greater brand variety in the aspirational mass-middle clothing segment, complementing its existing discount and value-focused offerings.
Legit specialises in ladies’ fashion, while Swagga and Beaver Canoe sell men’s clothing. Style offers family-focused fashion and accessories, and Boardmans sells homeware online.
In a statement on Monday, the Competition Commission said it found the deal unlikely to harm competition and approved it with conditions, including no retrenchments as a result of the merger, maintaining existing employment terms, and continuing or increasing procurement from small and historically disadvantaged suppliers.
The news of this acquisition first landed five months after the purchase of Choice Clothing, a discount retailer with more than 100 stores in SA and Namibia.
Pepkor indicated its intentions to ramp up efforts to capture a larger share of SA’s adult apparel market, which accounts for most of the country’s clothing sector, in its 2024 annual report published earlier this year.
While the group dominates the children’s and babywear categories, it is behind peers and rivals such as Mr Price, TFG, Truworths and Woolworths, which generally do well in the adult market.
A study by the Retailers’ Liaison Committee shows Pepkor’s commanding position in children’s clothing. According to the data, the group leads in babywear, accounting for two-thirds of sales, children’s apparel (half) and school uniforms (three-quarters).
However, with the adult apparel segment representing 60% of the total market, Pepkor now has a mandate to build a bigger base in adult wear.
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