South Africa's Truworths to buy UK's Office Retail Group

01 Dec '15

2 min read

South African fashion retailer Truworths International has said that it has entered into an agreement to buy an 88.9 per cent stake in Britain's Office Retail Group for 5.5 billion rand ($382 million), according to media reports.

The British retailer's management will retain an 11.1 per cent stake in Office. Truworths has the option to buy that stake within 3 to 5 years, it said in a statement. The 5.5 billion rand price tag will be funded in cash, it said.

Office, a footwear retailer with 150 stores, would be Truworths' first foray into Europe.

Truworths said in mid-September it had entered “preliminary non-binding negotiations” over a possible acquisition of Office Retail Group.

"Office is a highly attractive business with strong prospects which, under Truworths' ownership, will be further enhanced. The business is well positioned in the fashion footwear market with potential to expand into many new stores in the UK and Germany in the short- to medium-term and into other European countries in the medium- to longer-term," the statement said.

The deal also allows the local fashion retailer to expand its operations, extend its product offering, benefit from currency diversification and balance its revenue between cash and credit sales.

Office supplies young fashion footwear retailer in the UK and Republic of Ireland; offering men's, women's and sports footwear to fashionable 16 - 25 year olds at the mid-level price range.

It was founded in 1981 and has since grown to 104 stores and 47 locations in the UK, as well as 5 in the Republic of Ireland, trading under the “Office”, “Offspring”, “Poste” and “Poste Mistress” brands. In 2014, Office started expanding into continental Europe and has, so far opened 6 stores in Germany. Its e-commerce business accounts for about 20 per cent of sales.

Truworths has more than 650 stores in South Africa and 40 in the rest of Africa. It forms part of Truworths International, an investment holding whose brands incorporate Identity, YDE and Uzzi. (SH)

Fibre2Fashion News Desk – India