The Foschini Group Limited (JSE:TFG) entered into a sale purchase agreement to acquire Tapestry Home Brands Proprietary Limited from W. Brooks Investments Proprietary Limited, Actis LLP and current and previous management of Tapestry for ZAR 2.35 billion on March 7, 2022. The cash purchase consideration of ZAR 2.35 billion is structured on a debt-free, cash-free basis and payable at the time of implementation of the Transaction, subject to:a normalised level of working capital being retained in the business; normalised earnings before interest, taxes, depreciation and amortisation (“EBITDA”) of R360.9 million (“Target EBITDA”) being achieved for the financial year ended 28 February 2022. To the extent that the audited normalised EBITDA for such period (“Achieved EBITDA”) is less than ZAR 342 million (being c.95% of the Target EBITDA), the Purchase Consideration will be adjusted downwards at the transaction enterprise value / EBITDA multiple of 6.51 multiplied by the difference between ZAR 342 million and the Achieved EBITDA;an escalation rate based on the South African prime lending rate commencing from the date which falls on the last day of the calendar month preceding the date of which the last of the conditions precedent are fulfilled or waived, as the case may be (“Locked-Box Date”), until the Closing Date; and a portion of the Purchase Consideration being retained for the Sellers who are also executive management and which retention amounts will be paid on the first and second anniversary of the Closing Date, subject to remaining in the employ of TFG. The Transaction is subject to warranties and indemnities consistent with transactions of this nature. The Transaction will become effective following the settlement of the Purchase Consideration. The Transaction is subject to the fulfilment of the following conditions precedent, by no later than seven months following the date of signature of the SPA: approval being obtained from the relevant competition authorities and the Takeover Regulation Panel (as defined in the Companies Act No. 71 of 2008); lessors in respect of lease agreements which relate to stores that contribute at least 80% of the total revenue of Tapestry (“Lease Threshold”) having consented to the change of control which will result pursuant to the Transaction and/or waived their rights to terminate the lease agreements pursuant to the change of control; and lessors in respect of lease agreements relating to a number of key stores having consented to the change of control which will result pursuant to the Transaction and/or waived their rights to terminate the lease agreements pursuant to the change of control. As of July 27, 2022, Competition tribunal conditionally approves the transaction. As of July 28, 2022, Shareholders are hereby notified that all conditions precedent to the transaction have either been fulfilled or waived as set out in the SPA, Accordingly, the Transaction is now unconditional in accordance with the terms of the SPA and is envisaged to be implemented with an effective date of August 1, 2022.

Rand Merchant Bank acted as financial advisor and Edward Nathan Sonnenbergs Inc. acted as legal advisor for The Foschini Group Limited (JSE:TFG). Investec Bank plc acted as financial advisor and White & Case LLP acted as legal advisor for the sellers.