Monday, August 11 12:27:51
South Africa-based Spar Group, is to buy a majority 80pc stake in Ireland's BWG, which owns the Spar franchise in Ireland and parts of England.
Spar Group will pay E55m for the stake holding, which would give Spar a "well-positioned international retail platform for future expansion".
BWG has more than 1,100 stores, including 100 company owned stores, with a total annual turnover of approximately E1.2 billion.
The BWG Group has an estimated 35pc share of the Irish convenience store market.
It employs about 1,000 people directly and about 20,000 people in its stores, including owner-run franchise outlets.
The Purchase Consideration of E55 million, for the 80pc stake in the BWG Group, has been funded by a Rand-denominated loan and supports compelling long-term return expectations, underpinned by a well-established retail network and positive economic fundamentals in Ireland, the South African firm said.
On a pro-forma basis, the Transaction and Acquisition of Minority Interests would have led to a 6.8pc increase in SPAR's normalised headline earnings per share to 397.2 cents for the six months ended 31 March 2014, with a 30.2pc increase in SPAR's consolidated revenue.
BWG and Spar South Africa are well known to each other as both have been members of Spar International for the last 50 years. Mr Crawford is currently chairman of Spar International.
The company's CEO Leo Crawford said the move was a very positive and exciting development for it.
"In Spar South Africa, we have secured a major international retail player as a strategic partner and a long term investor in our business. We look forward to working with their team to accelerate the expansion of our operations and the growth of our wholesale and retail businesses in Ireland and the south west of England," he added.
BWG was originally part of the Brooks Watson Group before being acquired by Irish Distillers in the 1980s. The company was then bought from French drinks company Pernod Ricard in 2002 after a management buy-out - led by Leo Crawford - which was supported by Electra Partners, the London based venture capital company.
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