Pick 'n Pay, one of South Africa's leading supermarket chains, partly owned by the billionaire Ackerman family, has unveiled a 220.3-million fully underwritten, renounceable rights issue to strengthen its capital base.
The move follows a series of strategic maneuvers aimed at stabilizing the company's finances amidst operational headwinds.
Rights issue targets debt reductionThe R4-billion 220.3 million rights issue , approved by shareholders on June 26, 2024, is fully underwritten by a consortium of Absa Bank, Rand Merchant Bank, and Standard Bank of South Africa. It seeks to address Pick 'n Pay's deteriorating debt position and recent losses.
The rights issue, offering new shares to existing shareholders, will open on July 19. Proceeds will be used to reduce debt, lower interest expenses, and support the core business's recovery in FY2025. The planned IPO of discount retail chain Boxer is expected to further solidify Pick 'n Pay's financial position.
