Shareholders of Deacons East Africa and other investors have been asked to exercise caution when dealing with its shares on the Nairobi Securities Exchange (NSE) following an offer by Mr Price Group Ltd to purchase the Mr Price franchised business in Kenya.
In a public notice, Deacons EA Company Secretary JLG Maonga, however, said the offer is still subject to regulatory approvals and the same would be circulated to shareholders for consideration prior to a meeting to consider it.
“Mr Price Group Limited, one of the franchisors of Deacons, has approached Deacons with a proposal to purchase the Mr. Price franchised business in Kenya. Accordingly, Deacons has entered into preliminary negotiations in respect of the sale of Mr price franchised business to Mr Price,” said Maonga.
Related: Deacons half-year net profit drops by 32%
Deacons (East Africa) PLC, previously Deacons Kenya Limited, operates retail establishments including franchise and department stores selling ladies, men’s and children’s clothing, footwear, accessories, toiletries, gifts, home-furnishings, cosmetics and sporting goods amongst other items in East Africa.
On the other hand, Mr Price, a South African-based company, retails apparel, homeware and sportsware through owned and franchised stores and online channels in Africa and Australia. Merchandise is predominantly own-branded and targeted at younger customers in the mid to upper LSM categories.
Deacons EA has been selling Mr Price products under a franchise deal. Reports that the two fashion companies could part ways emerged as early as 2013 when it Deacons indicated Mr Price was seeking to go it alone in the Kenyan market.
Leave a comment