6th Feb 2015 07:19
LONDON (Alliance News) - Poundland Group PLC on Friday said it has struck a deal to buy rival 99p Stores Ltd for GBP55 million in cash and shares.
FTSE 250-listed Poundland said it will pay GBP47.5 million in cash for its fellow high-street discounter, along with a further GBP7.5 million in shares. Based on its closing price of 357.8 pence on Thursday, that would see Poundland issue 2.1 million shares.
The deal includes 99p Stores' network of 251 stores, Poundland said. In the year to February 1, 2014, 99p Stores reported underlying earnings before interest, taxation, depreciation and amortisation of GBP6.1 million on sales of GBP370.4 million, it said.
Poundland said the deal will be conditional upon the approval of the UK Competition and Markets Authority. Poundland said that following initial talks with the competition regulator, it may have to offer concessions to get the deal passed.
"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," said Poundland Chief Executive Jim McCarthy.
By Sam Unsted; [email protected]; @SamUAtAlliance
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