UPDATE 2-Poundland-owner Pepco faces 'almost inevitable' sale by Steinhoff
* Pepco Group is part of South Africa's Steinhoff
* Steinhoff evaluating options for Pepco
* Media report of possible private equity bid for Pepco
* Pepco Q1 revenue up 13.3%, underlying revenue up 3.9%
(Recasts with CEO comment)
By James Davey
LONDON, Feb 5 (Reuters) - The boss of Pepco Group, the owner
of British discount retailer Poundland, said it was "almost
inevitable" the group would be sold by its beleaguered South
African parent Steinhoff .
Steinhoff, which has been battling the fallout from a 2017
accounting scandal, said last year it was evaluating a range of
strategic options for Pepco Group, including a potential public
listing.
On Monday Sky News reported that three private equity firms
- Advent International, Hellman & Friedman and Mid Europa
Partners - had teamed up for a possible bid for Pepco that could
value it at more than 4.5 billion euros ($5 billion).
[nL4N2A33TX]
"The restructuring arrangement that Steinhoff has with its
creditors means it's almost inevitable we'll be sold," Pepco
Group CEO Andy Bond told Reuters on Wednesday after it updated
on Christmas trading.
He said he was "genuinely open minded" on the various
disposal options - a private equity sale, initial public
offering, or trade sale to an industry peer - and added that it
was "early days" in the process.
Bond, a former boss of supermarket group Asda, said if Pepco
did get new owners, he wanted to stay on.
"I've helped build this business. It's a great business and
I will want to continue to deliver our ambition to be Europe's
biggest discount variety business," he said.
PEPCO BRAND GROWTH
Pepco Group, which also owns the PEPCO and Dealz brands in
Europe, reported a jump in revenue in the Christmas quarter and
forecast more growth in the rest of its 2019-20 financial year.
Revenue in its fiscal first quarter to the end of December
rose 13.3% to 1.143 billion euros, reflecting a 14.8% increase
in stores to 2,809, along with a rise in like-for-like revenue
of 3.9%.
The group highlighted the increased size of its PEPCO store
portfolio in Central and Eastern Europe, the start of the
roll-out of the Dealz format in both Poland and Spain, and
reduced operating costs within Poundland, including the
renegotiation of a further 36 store leases.
The group is focused on expanding the PEPCO brand, which
currently trades from 1,898 stores, to fuel growth.
Bond said he was targeting the opening 300 PEPCO stores a
year over the next decade.
($1 = 0.9060 euros)
(Reporting by James Davey; Editing by Louise Heavens and Pravin
Char)
((james.davey@thomsonreuters.com; +44 20 7542 7674))
Rank : positive
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