Fashion group in Mr Price will grow its list of stores after it acquired Blue Falcon 18 which is trading as Studio 88 Group. This comes after the Competition and Consumer Authority (CCA) unconditionally approved the proposed merger between the two.
The CCA says it has established that there exists an overlap in the activities of the merging parties in the relevant market. “However, there exists enough competition in the market to discipline the behavior of the Merged Enterprise,” CCA says in a statement released recently.
“Thus, the Authority did not establish any substantial lessening of competition concerns arising from the merger. Furthermore, there is no acquisition of market dominance post-merger; nor any negative effect on public interest that was identified as per the provisions of section 52(2) of the Competition Act, 2018.”
The acquiring enterprise in Mr Price Group controls Mr Price Botswana Proprietary Limited. Mr Price Botswana operates through the various retail store brands in Botswana which include Mr Price Apparel (15 stores) which sells fashion-value apparel, footwear, accessories, cosmetics and ancillary products such as mobile phone handsets and airtime. Then there is Miladys (four stores), Mr Price Sport (two stores), Mr Price Home (four stores) and Sheet Street (eight stores).
The target enterprise in Studio 88 sells branded sports-lifestyle, “athleisure’’ apparel, footwear and accessories. Prominent brands sold by Studio 88 include Adidas‚ Ellesse, Puma‚ Converse‚ Nike‚ Guess‚ Superga and Levi. In Botswana, Studio 88 controls The Branded Clothing Company (Pty) Ltd (Studio 88 Botswana). Studio 88 Botswana operates various stores in the country whichinclude Studio 88 (nine), Side Step (five) and Skipper Bar (three).
The deal between Mr Price and Studio 88 has long been signed in neighboring South Africa where the two companies originate. According to South African publication BUSINESSTECH, Mr Price has already entered into a transaction agreement to acquire 70 percent of Blue Falcon for R3.3 billion.
The Studio 88 Group is highly cash-generative and operates on a cash-only basis, which contributes to its value positioning “The inclusion of the Studio 88 Group would increase Mr Price’s annual revenue to over R28 billion and would prospectively become the group’s second-largest of nine trading divisions,” the publication quoted Mr Price as saying in an article published on April.
The CCA is responsible for the prevention of, and redress for anti-competitive practices in the economy, and the removal of constraints on the free play of competition in the market; as well as the protection of consumer rights by means of investigation, prohibition and control of unfair business practices.