FRAS Frasers Group Plc

Date: 26 November 2024

Frasers Group expands global footprint with acquisition of South African sporting, outdoor and recreation goods leader, Holdsport

Leading global retail group Frasers Group ("Frasers" or the "Group"), today announced the conclusion of an agreement for the acquisition of South Africa's leading sporting, outdoor and recreation goods company, Holdsport Group ("Holdsport") from Old Mutual Private Equity ("OMPE") and Holdsport's management.

Holdsport is a diversified business operating across retail, wholesale, manufacturing, distribution, and e-commerce, focused on the sport, outdoor, and recreation sectors across South Africa and Namibia. It is home to Sportsmans Warehouse, the leading elevated sporting goods chain in the region, and Outdoor Warehouse, an outdoor, camping, hiking, adventure retailer - complementing Frasers Group's existing divisions. It also owns Shelflife, South Africa's premium sneaker and streetwear store. For Holdsport's financial year ended February 2024, sales generated exceeded R3 billion (GBP130 million). Holdsport has demonstrated exceptional financial performance, with robust profit growth and strong cash flow, underscoring its value to Frasers' strategic vision.

With a total of 88 stores across South Africa and Namibia and a rapidly growing e-commerce offering, Holdsport's network will act as a platform to expand Sports Direct across the region. Frasers Group will utilise this strong position to grow its sport, fashion and brand distribution presence, furthering the Group's commitment to international expansion.

Holdsport has well-established relationships with major international brands, including Nike, adidas, Asics, Hoka, and Garmin, supported by their own brand portfolio including First Ascent, Cape Storm and OTG. The acquisition aligns with Frasers Group's plans to diversify its product range and geographic reach while leveraging Holdsport's established market presence and local market expertise.

The acquisition also includes Holdsport's infrastructure, including modern warehouses with capacity for growth and offices in Johannesburg and Cape Town, as well as a factory that supports local manufacturing and distribution.

This deal comes shortly after Frasers announced a significant investment into the Malta-based retail business Hudson Group, which operates sport, lifestyle and fashion stores and distribution of major global brands across 36 countries in Europe and North Africa.

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."

Jacci Myburgh and Chumani Kula, Co-Heads of Old Mutual Private Equity, said: "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, commented: "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."

The transaction is subject to customary regulatory approvals and is expected to close in the coming months.

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About Frasers Group plc

Frasers Group started as a small store in Maidenhead in 1982 and from there, grew to become a global powerhouse. As the business evolved, 2019 saw the rebrand of Sports Direct International to Frasers Group plc; a reflection of the Group's growth and change in market identity.

Led by Chief Executive Michael Murray, the business is set on a formidable upwards trajectory as it continues to expand with its pioneering approach to retail. Frasers Group provides consumers with access to the world's best Sports, Premium and Luxury brands with a vision to build the planet's most admired and compelling brand ecosystem.

As a leader in the industry, Frasers Group is committed to rethinking retail by driving digital innovation and providing unique store experiences to its consumers globally.

About Old Mutual Private Equity

Old Mutual Private Equity, part of Old Mutual Alternative Investments, is one of the largest and most established private equity managers in South Africa with a 24-year heritage of being a significant investor in privately owned businesses across key industries and sectors. OMPE has invested in some of South Africa's strongest private businesses, including Actom, Tourvest, Ti-Auto, Primedia, In2Food and 10x. We have deployed more than R12 billion across 37 transactions, delivering R34 billion in value, including R21.5 billion across 26 exits and R12.4 billion in remaining value.  OMPE has also been involved in some of the landmark private equity transactions in South Africa over the years, including some of the largest PE delistings from the Johannesburg Stock Exchange (Pepkor, Consol Glass, Long4Life) and some of the largest PE exits, including the IPO of Life Healthcare. OMPE is currently raising and deploying its sixth fund, OMPE Fund VI.

About Holdsport Group

Holdsport is the leading specialist sports and outdoor goods retailer in South Africa, trading countrywide through the well-known Sportsmans Warehouse and Outdoor Warehouse brands. The stores are modern, offering both international and local brands and providing technical expertise to customers. With a longstanding reputation in the South African market, the group has a large loyal customer base and a strong brand presence. Holdsport also holds a specialty sneaker and apparel retailer, Shelflife, in its portfolio.

Holdsport's portfolio of assets also includes Performance Brands, a wholesale, manufacturing and distribution business focused on the sport, outdoor and recreation sectors. The group designs and manufactures its own brands and, additionally, is the Southern African representative for a number of leading international sport equipment brands.

Holdsport was previously listed on the JSE during the years 2011-2017 and was a subsidiary of Long4Life from 2017 to 2022 which was also listed on the JSE and was subsequently delisted by Old Mutual Private Equity in 2022.

Financial Advisers

Nedbank CIB, Financial Adviser to Frasers Group

Nedbank Transaction Team:  Brad Webber and Warrick Haskell

Investec Bank plc, Financial Adviser to Holdsport 

Investec Transaction Team: Marc Ackerman and Peter Steward (South Africa), Oliver Cardigan (United Kingdom)

For media enquiries, please contact:

Frasers Group Corporate Communications, 

FrasersGroup@brunswickgroup.com

Old Mutual Private Equity Corporate Communications,

melissa.londt@magna-carta.co.za

Holdsport Corporate Communications,

michelle@aprio.co.za