Mr Price Group (MRP) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition of NKD provides a platform for offshore expansion into Central and Eastern Europe, leveraging a proven value retail model aligned with existing operations and supporting a value-focused growth strategy.

• NKD operates in a high-growth value apparel and homeware sector, with strong brand recognition, a proven management team, and cultural alignment.

• The deal is transformational, granting access to larger, more stable markets and currencies, diversifying geographic risk, and supporting long-term growth.

• NKD’s established presence and scalability offer significant growth potential, including possible future introduction of additional brands.

• Value retailing in Europe is growing faster than the total retail market, supporting the strategic fit.

Financial terms and conditions

• Maximum purchase price is €487 million, covering both shares and shareholder loan receivables, with a lockbox date of June 30, 2025.

• Base purchase price for shares is €415 million, with an additional €38.5 million for shareholder loan receivables, both subject to escalation until closing.

• Transaction is fully funded by internal cash and new debt, with a targeted debt to EBITDA ratio of 1–1.5x.

• Currency risk has been hedged, and further capital structuring will be reviewed post-closing.

• Transaction must close within six months of signing, subject to fulfillment or waiver of conditions.

Synergies and expected cost savings

• Both businesses are cash-based, private label, and omnichannel, allowing for operational alignment and knowledge sharing.

• NKD’s data science and sourcing capabilities are expected to support margin improvement and operational efficiencies.

• No significant short-term synergy benefits expected; focus is on long-term value creation.