Subscribe & Follow
Jobs
- Front Desk Representative Johannesburg
- Repair Shop Assistant Pinetown
- New Business Developer - Food Packaging Johannesburg
- Country Head - FMCG: Food and Consumables Johannesburg
- Point of Sales - Counter Sales Pretoria East
- Qualified Barista Pretoria East
- In-store Sales Representative Mbombela
- Area Sales Consultant Cape Town
- Customer Service Team Manager - UK Market Work From Home
- Entry Level Sales Assistant Wellington
Boxer IPO in Johannesburg could raise close to R8bn for Pick n Pay
Pick n Pay previously said proceeds from the IPO could be between R6bn and R8bn ($339m and $452m).
The retailer said in a statement that the Boxer IPO would include an overallotment option, which was not expected to exceed R500m and would be settled through the issuance of new shares.
An overallotment option grants the underwriter the right to sell more shares than originally planned if demand proves higher than expected. It provides price stability.
The IPO is part of Pick n Pay's two-step recapitalisation plan for much needed cash to lower its debt and fix its loss-making core Pick n Pay supermarkets business.
The group also wants Boxer to be accorded a market value which appropriately reflects its "superior" growth and return on invested capital.
"We've been able to obtain unsecured committed term debt and working capital facilities for the Boxer business post the IPO" from funding partners, group chief finical officer Lerena Olivier told investors.
Boxer said it has an expected gross drawn term debt of up to 850 million rand and about 2 billion rand of working capital facility.
Pick n Pay will retain a controlling stake in Boxer, Olivier added.
The company targets a dividend pay-out ratio of 40% of Boxer group headline earnings, it said.
Boxer, with 489 stores, is South Africa's fastest growing discount grocery chain, with about 68% market share of the discount grocery retail market.
As part of its strategy to grow, Boxer is actively pursuing store expansion, including rollouts to untapped areas, developing its suite of value-added services and expanding its supply chain with additional distribution centres where necessary to support new stores, it said.
For its 2025 financial year, Boxer forecasts turnover growth of about 10%-12%, and mid-teens growth in the next three to five years. It aims to double turnover within five years, the retailer added.
In the 26 weeks ended Aug. 25, turnover rose by 12% to R19.8bn, it said, while its trading profit increased by 11.8% to R809m.
Source: Reuters
Reuters, the news and media division of Thomson Reuters, is the world's largest multimedia news provider, reaching billions of people worldwide every day.
Go to: https://www.reuters.com/