Financial

Spree, Superbalist to merge

Takealot CEO Kim Reid. (Photo by Debbie Yasbek)
Takealot CEO Kim Reid. (Photo by Debbie Yasbek)

Media24 and Takealot.com today announced that they will merge their online fashion brands, Spree and Superbalist, creating a new joint online fashion platform.

There is currently no integration between Spree and Superbalist, although both are part of the JSE-listed Naspers group, with each business running its own sourcing and buying, technical, marketing, warehousing and logistics functions while primarily targeting a similar, if not the same customer segment and demographic in South Africa. Merging the two businesses into a single entity will create a larger, more focused platform on which to build a substantial online retail, footwear and apparel business, the groups say.

The new venture will be held 51% by Media24, Spree's current shareholders, while the Takealot group will own 49% of the venture. Takealot will however be responsible for the day-to-day operations and management of the business.

The merger will be effective on 1 July 2018 and is not subject to Competition Commission approval. The merged entity will undergo a two to three month period of integration planning and implementation during which each business will continue to operate independently before final integration.

"We are very excited about the opportunity to further accelerate the growth of online fashion retail in South Africa. We look forward to welcoming Spree into the Takealot group," said Kim Reid, Takealot group CEO.

In South Africa the penetration of online retail sales is currently around 1%, while in the USA, China and the UK it is in excess of 13%. Clothing and footwear sales in the UK drive a large share of the growth of online retail with similar trends in the USA, China and India. The groups believe this suggests that there is room to build a substantial position in the online footwear and apparel market in South Africa.

"Media24 believes in and loves e-fashion. Since starting Spree in 2013 we have always said e-fashion is a very important growth portfolio to ensure a diversified and sustainable future for Media24. That is why we are delighted to be the majority shareholder in the combined business," added Esmare Weideman, CEO of Media24.

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