Johannesburg - The Foschini Group agreed to buy UK clothing chain Whistles for an undisclosed sum, accelerating the South African retailer’s international expansion.
Whistles has 46 standalone stores in the UK and its products are stocked in department stores including Bloomingdales in the US and Harrods in London, TFG said in a statement on Thursday.
The deal follows the Cape Town-based company’s acquisition of Phase 8, another UK chain, for 140 million pounds ($197 million) last year.
“Whistles is an iconic brand and we see enormous growth potential for the brand in the UK and also internationally,” Chief Executive Officer Doug Murray said by phone. “We have a management team in place on that side and will start working with the Whistles team from today to discuss the plans for the business going forward.”
Read also: Foschini: Whistles talk blows positive vibes
South African retailers have been snapping up European companies to diversify away from the rand, which has weakened about 24 percent against the dollar over the last year. Other deals include Truworths International’s purchase of a majority stake in UK shoe chain Office Retail Group, while furniture retailer Steinhoff International Holdings agreed to buy electronics retailer Darty for 673 million pounds earlier this month.
Whistles’ last available accounts showed that annual sales increased by 9 percent to 63 million pounds while the pre-tax loss was 2.4 million pounds, according to The Telegraph newspaper. The seller is Icelandic investment company Mundur.
TFG shares fell 3.2 percent to R136.04 as of 11:06 a.m. in Johannesburg, valuing the company at R29.4 billion ($1.9 billion). The stock is up 12 percent this year, compared with a 5.9 percent fall on the FTSE/JSE Africa General Retailers Index.
TFG hasn’t reported the deal price because it’s “not material,” Murray said.
BLOOMBERG