Pick n Pay adds some meat to its cart with new acquisition

Retail group Pick n Pay acquires Western Cape-based abattoir and meat processing company Tomis for R340m.

1. The purchase is expected to expand Pick n Pay’s red meat offering and enhance its fresh meat selection.
2. Tomis possesses key assets including a lamb feedlot, abattoirs, and a meat packaging plant, along with strong animal welfare and environmental standards.
3. The transaction fee consists of an upfront cash consideration of R323m, with the remaining R17m payable on the third anniversary.
4. The deal brings benefits like access to higher-quality and consistent red meat, sales growth opportunities, and potential supply to Pick n Pay franchisees, Boxer, and other retailers.
5. Pick n Pay adjusts capital investment plans, leasing a distribution center instead of purchasing, as it takes a more cautious approach amid a sluggish economy and rising net debt.