South African retail Group, Foschini Group, TFG has acquired an Australian menswear retailer called Retail Apparel Group (RAG) for a maximum of 302.5 million Australian dollars ($226.78 million).
TFG, also owns British fashion retailers Phase Eight and Whistles, said it would pay cash for RAG and would retain the company’s current management.
RAG, established in 1987, has 400 stores which sell mostly mid-range to low-price menswear.
The company said in a confirmation of the deal that the price will be the lower of 302.5 million Australian dollars or seven times the company’s earnings for the year to end-June.
TFG is one of the foremost independent chain-store groups in South Africa. We have 22 retail brands that trade in clothing, jewellery, accessories, sporting and outdoor apparel and equipment, cellular goods and services and homeware to the broad, primarily middle and upper income groups throughout 3 000+ stores predominantly in Southern Africa. 42,2% of turnover is in the form of cash sales to customers, with the balance being on credit. The majority of merchandise sold in our stores is under our own brand names. In addition to retail turnover, revenue is also generated from interest received, as well as through various customer value added products which are primarily sold through our call centre. Merchandise is sourced both locally and internationally. In addition we have an in-house design and manufacturing facility which co-ordinates production through our own factories as well as through various independent cut, make and trim factories.