South Africa's TFG to buy Coricraft owner for $152 mln (updated)

China Cultural Tourism and Agriculture

07/03/2022 07:19

* Acquisition allows TFG to expand further into furniture,
bedding
    * Tapestry buyout to help TFG accelerate local manufacturing
    * TFG to acquire Tapestry from private equity firms

 (Adds details, changes media packaging code to
TAPESTRY-M&A/FOSCHINI GROUP)
    By Nqobile Dludla
    JOHANNESBURG, March 7 (Reuters) - South Africa's TFG
 TFGJ.J  will buy the owner of Coricraft, Volpes and Dial-a-bed
chains for 2.35 billion rand ($152.78 million) as it looks to
expand further into the furniture and bedding market, the
retailer said on Monday. 
    The acquisition will help TFG reduce its reliance on Asia
and other import markets, allowing it to source products locally
amid spiralling shipping costs and COVID-19 supply chain
disruptions.  urn:newsml:reuters.com:*:nL1N2S20CV
    "The transaction is in line with TFG's stated strategy of
vertical integration in key product categories, and the
continued development of its quick response local manufacturing
capability," the clothes, homeware and jewellery retailer said. 
    Local manufacturing helps improve a retailer's lead time,
increasing its competitiveness against local and global chains. 
   
    TFG, also known as Foschini Group, said it is acquiring the
shares of Tapestry Home Brands from private equity firm
Westbrooke Investments Proprietary Limited, funds managed by
Actis, as well as the current and previous management of
Tapestry using cash. 
    Tapestry, a vertically integrated designer, manufacturer and
omnichannel cash retailer of home furnishings targeting the
middle to upper market operates 175 stores across South Africa,
Namibia and Botswana.
    Tapestry's locally manufactured products account for about
47% of its overall net sales, with manufacturing facilities
located in Cape Town, Johannesburg and Gqeberha.
    The value of Tapestry's net assets was 115 million rand as
of Feb. 28, 2021, while earnings before interest, tax,
depreciation and amortization were 264 million rand, with a
profit after tax attributable to the net assets of 34 million
rand, TFG said.     
    Following the acquisition, TFG will have nine home consumer
brands and four vertically integrated factories.

    ($1 = 15.3820 rand)

 (Reporting by Nqobile Dludla; Editing by Olivia
Kumwenda-Mtambo)
 ((nqobile.dludla@thomsonreuters.com; +27103461066;))