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Johannesburg – Massmart Holdings [JSE:MSM] shares surged more than 10% on Monday morning on news that global retailer Walmart Stores has made a non-binding offer to acquire the local retailer for R148 per share.
Already considered trading at a premium because of the anticipated offer, Massmart shares traded above R150 shortly after the announcement. At 11:00 it was trading at R148.80.
Addressing journalists on a conference call, Massmart CEO Grant Pattison said the bid amounts to R32bn inclusive of all issued shares and options.
Pattison said Walmart has expressed interest to retain current management if the deal went through but it be would fair to assume Massmart would subsequently delist from the JSE.
Andy Bond, Walmart’s executive vice president responsible for Africa, said South Africa presents a compelling growth opportunity for the global retailer and offers a platform for growth and expansion in other African countries.
“South Africa possesses attractive market dynamics, favourable demographic trends and a growing economy,” said Bond.
The proposed acquisition is part of Walmart’s strategy to move into Africa. Massmart currently operates in 14 sub-Saharan Africa countries.
The announcement ended a year of speculation that Walmart was interested in Massmart.
Massmart – the owner of Game, Dion Wired, Builders Warehouse and others – said in the event that a firm offer is received, its board will obtain an independent opinion and then express a view on the offer to shareholders.
The proposed offer is subject to a number of pre-conditions including due diligence, which will commence immediately. In order to satisfy these pre-conditions, a period of exclusivity has been granted by Massmart to Walmart.
Doug McMillon, president and CEO of Walmart International said: “Walmart’s mission is to save people money so that they can live better lives. We believe this proposed acquisition is a great opportunity to deliver on that mission for all the people in the regions of the African continent where Massmart currently operates.
“We have the opportunity to leverage our experience from around the world to more effectively serve customers, create opportunities for our associates and add shareholder value. We are continuing to deploy our strategy to accelerate growth and improve returns in our international business and this region of the world fits with our focus on large, high growth markets. This potential combination with a market leader will enable us to add value to an already successful business through investments in people and technology.”
Massmart said shareholders will be updated at the time of renewal of the cautionary announcement, as required in terms of JSE regulations, which will be on November 8 2010.
Massmart would be advised by Goldman Sachs, Deutsche Bank and its lawyers on the deal.
- Fin24.com
Already considered trading at a premium because of the anticipated offer, Massmart shares traded above R150 shortly after the announcement. At 11:00 it was trading at R148.80.
Addressing journalists on a conference call, Massmart CEO Grant Pattison said the bid amounts to R32bn inclusive of all issued shares and options.
Pattison said Walmart has expressed interest to retain current management if the deal went through but it be would fair to assume Massmart would subsequently delist from the JSE.
Andy Bond, Walmart’s executive vice president responsible for Africa, said South Africa presents a compelling growth opportunity for the global retailer and offers a platform for growth and expansion in other African countries.
“South Africa possesses attractive market dynamics, favourable demographic trends and a growing economy,” said Bond.
The proposed acquisition is part of Walmart’s strategy to move into Africa. Massmart currently operates in 14 sub-Saharan Africa countries.
The announcement ended a year of speculation that Walmart was interested in Massmart.
Massmart – the owner of Game, Dion Wired, Builders Warehouse and others – said in the event that a firm offer is received, its board will obtain an independent opinion and then express a view on the offer to shareholders.
The proposed offer is subject to a number of pre-conditions including due diligence, which will commence immediately. In order to satisfy these pre-conditions, a period of exclusivity has been granted by Massmart to Walmart.
Doug McMillon, president and CEO of Walmart International said: “Walmart’s mission is to save people money so that they can live better lives. We believe this proposed acquisition is a great opportunity to deliver on that mission for all the people in the regions of the African continent where Massmart currently operates.
“We have the opportunity to leverage our experience from around the world to more effectively serve customers, create opportunities for our associates and add shareholder value. We are continuing to deploy our strategy to accelerate growth and improve returns in our international business and this region of the world fits with our focus on large, high growth markets. This potential combination with a market leader will enable us to add value to an already successful business through investments in people and technology.”
Massmart said shareholders will be updated at the time of renewal of the cautionary announcement, as required in terms of JSE regulations, which will be on November 8 2010.
Massmart would be advised by Goldman Sachs, Deutsche Bank and its lawyers on the deal.
- Fin24.com
