Frasers Group, the retail empire founded by billionaire Mike Ashley, has continued its global expansion with the acquisition of a South African company.
The London-listed group, which already owns the likes of Sports Direct and House of Fraser, has snapped up sporting, outdoor and recreation goods company, Holdsport Group, for an undisclosed sum from the firm’s management and Old Mutual Private Equity.
Holdsport operates across retail, wholesale, manufacturing, distribution and e-commerce and has operations in South Africa and Namibia.
For its latest financial year, to February 2024, the group posted a revenue of more than R3bn (£130m).
The group has 88 stores while its network will now act as a platform to expand Sports Direct across the region.
The deal comes after Frasers Group announced its investment into Malta-based retail business, Hudson Group.
It has also been announced that Frasers Group has snapped up a £3mi stake in Marks Electrical.
Online white goods retailer Marks saw shares move higher in early trading on Tuesday as a result.
In a stock market filing, Marks revealed that Frasers has bought 6.73m shares in the business.
The deal will give Frasers a 6.4 per cent stake in the Leicester-based retail firm.
Nevertheless, the company is still under the majority control of founder Mark Smithson, who had retained a stake of more than 70 per cent in the business.
‘A great step forwards for us’ – Frasers Group
In a statement issued to the London Stock Exchange Michael Murray, CEO of Frasers Group, said: “Holdsport has built an incredible brand and reputation across Southern Africa, and we see potential in combining their regional expertise and own brands with our scale and resources, establishing a strong platform for growth.
“This acquisition is a great step forward for us, not only in expanding our footprint but also in enhancing our ability to meet the rising demand for high-quality sporting goods in a region with such dynamic growth.”
In a joint statement Jacci Myburgh and Chumani Kula, co-heads of Old Mutual Private Equity, added: “Holdsport is an iconic South African business that has been well loved and regularly supported by many South African households over the years.
“We are proud to have been the custodian of such a strong business, with a great platform, offering well-known local and international brands.
“The acquisition by Frasers, a well-respected global retailer, is a testament to the quality of the Holdsport offering and demonstrates confidence in the South African economy.
“Furthermore, the transaction reaffirms our expertise of investing alongside strong and aligned management teams in high quality businesses in order to inspire an ownership and growth mindset to achieve an attractive investment outcome for our investors, whilst ultimately ensuring the right home for the business and the management team.
“We wish Frasers and the Holdsport management team all the best for their next chapter.”
Bradley Moritz, Holdsport, CEO, said: “We are delighted with Frasers’ acquisition of Holdsport and their inaugural investment into Southern Africa.
“Frasers is a leading international player in the sports retail industry, and this is a strong vote of confidence in our business and our country.
“Frasers is a natural home for Holdsport, given their passion for sport, outdoor, brands and their focus on customer service and innovation.
“I look forward to the energy and creativity that the combined businesses will bring, and I have no doubt that with Frasers’ skills, resources and innovation, Holdsport will grow from strength to strength.
“I also wish to thank OMPE for the strong partnership with them as owners of the business. Their commercial perspective and high-quality input have been instrumental to Holdsport’s ongoing success.”
Frasers Group said the deal is expected to close in the coming months. While the value has not been revealed, the figure is likely to be confirmed in future filings with the London Stock Exchange by Frasers Group.