Pick n Pay Sets Boxer Price Range for Africa’s Biggest 2024 IPO
Pick n Pay Stores Ltd. is seeking to raise 8 billion rand ($449 million) through an initial public offering in discount retailer Boxer Retail Ltd. in what is set to be Africa’s biggest listing this year.
Boxer is sourcing the funding through the issue of as many as 190.4 million shares in a range of 42 rand to 54 rand each, Pick n Pay said in a statement. The deal size could increase to 8.5 billion rand through an allocation of additional shares under a so-called green shoe option, the Cape Town-based retailer said by email.
That would give Boxer an implied market value of 21.1 billion rand to 24.7 billion rand, Pick n Pay said.
Within hours, Pick n Pay had received demand in excess of the deal size throughout the price range, according to terms seen by Bloomberg News. Trading is scheduled to start on the main board of Johannesburg’s stock exchange on Nov. 28, with a secondary listing on the local alternative market.
The IPO in Boxer forms part of a turnaround plan by Pick n Pay Chief Executive Officer Sean Summers’ to recapitalize the South African supermarket chain and stem years of market-share declines. Pick n Pay has raised an additional 4 billion rand through a rights issue earlier this year.
Boxer, which caters to the lower end of the grocery market, has 500 outlets across South Africa, of which half were added in the last seven years. Pick n Pay intends to still own at least 60% of Boxer after the IPO, it said.
Pick n Pay shares pared losses of as much as 4.9% to trade 1.7% lower at 25.23 rand at 1:08 p.m. in Johannesburg. The company has gained 28% this year, making it the best performer of the six-member FTSE/JSE Personal Care, Drug and Grocery Stores Index for the period.
The joint global coordinators and book-runners of the offering are Rand Merchant Bank, Morgan Stanley, Absa Group Ltd. and Standard Bank Group Ltd.
