Poundland agrees to buy 99p stores for £55m
Poundland has agreed to acquire rival discounter 99p Stores for £55 million subject to approval by the competition authorities.
The proposed transaction includes 251 stores trading as 99p Stores and Family Bargains as well as a warehouse and distribution centre.
The acquisition is conditional on the approval of the Competition & Markets Authority. While Poundland and 99p Stores have already held preliminary discussions with the CMA, Poundland said in a statement: ”The CMA may require Poundland to take actions or give remedies to address any impact on competition arising as a result of the proposed transaction.”
The CMA will begin a public consultation and review process shortly which is expected to take at least two months.
Jim McCarthy, chief executive of Poundland, said: “This is a good deal for both businesses and will benefit customers and shareholders. Through working together, Poundland will improve choice, value and service for 99p Stores’ customers, bringing Poundland’s proven know-how and range to 99p Stores.
“We also believe that we can improve the performance of the 99p Stores estate and generate further value for Poundland’s shareholders.
“We look forward to working with the CMA as it undertakes its review.”
In the year to 1 February 2014, 99p Stores achieved sales of £370.4 million with underlying EBITDA of £6.1 million.
Poundland has almost 600 shops in the UK, Ireland and Spain.
Source: The Retail Bulletin