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Poundland agrees to £597m takeover

BBC News BBC News 13/07/2016
Poundland hoarding above shop: Poundland accepts © Getty Images Poundland accepts

Discount chain Poundland has agreed to a £597m takeover by South African retail group Steinhoff International.

Steinhoff is paying 222 pence per share for the discount retailer.

Steinhoff had made an informal approach for Poundland last month, but the offer was rejected.

Since 1990, Poundland has opened more than 750 shops in the UK, Ireland and Spain. In September 2015, Poundland took over rival 99p Stores but has since seen a slowdown in sales.

Its share price has fallen from 418p in February 2015 to below 200p.

The pound has also dropped about 15% against the rand since Steinhoff made its approach for Poundland in June

Steinhoff which already had a 23% stake in Poundland, owns Pep, a retailer with 1,800 stores across 10 countries in southern Africa that sells discount clothing, footwear and homewares.

The group, which also also owns the UK furniture chain Harvey's, makes most of its products in developing countries, and sells its furniture across Europe.

Poundland chairman Darren Shapland said: "The Poundland board believes that Steinhoff's all-cash offer presents Poundland shareholders with an opportunity to realise their shareholding at a certain and attractive price."

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