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Lojas Renner BoD approves Leader acquisition
05
Sep '08
The second largest apparel department store chain in Brazil, Lojas Renner announces that its Board of Directors has approved the acquisition of Leader Participacoes S.A, which holds 100% of the capital stock of Uniao de Lojas Leader S.A, and, indirectly, 50% of the capital stock of Leader S.A. Administradora de Cartoes de Credito.

Complementarities and synergies of the new operation. The client overlap between the two chains is small, and the business complementarity is significant.

From a marketing point of view, both operations will be kept separate, with Lojas Renner keeping its focus on the middle and upper-middle income segments of the Brazilian population, and Leader concentrating on the emerging low income segment.

After the Leader acquisition, Renner will also hold one of the largest private label card bases in Brazil, currently with approximately 17 million cards.

By adopting Leader's compact-store format, with an average selling area of 1,500 square meters, Lojas Renner may speed up the opening of new stores, both in malls and stand-alone formats.

In 2007, the two companies together recorded sales of R$3.1 billion, 15.6 million cards issued, 14,000 employees, 133 stores and 3 distribution centers.

Leader, having good penetration in the low income market (classes C and D), is an important channel for the offer of financial services to a population with less access to banking services and greater demand for credit.

Through a joint venture with Bradesco, Leader offers a wide variety of products: interest-bearing sales, personal loans, co-branded cards (in a partnership with Visa) and revolving credit, in addition to offering insurance and capitalization bonds.

With a solid operation, 66% of total sales are conducted through its private label card, 36% of which are interest-free and 30% interest-bearing.

Lojas Renner

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