South African retail giant The Foschini Group (TFG) has confirmed it plans to grow its presence in the country’s apparel sector through the acquisition of some of Jet Group’s assets.

TFG submitted a conditional offer to acquire certain “commercially viable stores and selected assets of Jet”, a division of Edcon Limited, for a cash purchase consideration of ZAR480m (US$29m).

“Jet is a leading Southern African retailer (by brand recognition and market share) and would provide TFG with a strategically important expansion into the value segment of the Southern African retail apparel market,” TFG said in a bourse disclosure. “The proposed transaction enables TFG to acquire selected parts of the Jet business, a unique opportunity which previously was not possible and is expected to give TFG the significant scale at an attractive price.”

The acquisition would see it absorb 371 “commercially viable” Jet stores, including a distribution centre in Durban, along with plants, equipment and all existing stock holdings with a minimum stock value of no less than ZAR800m.

Meanwhile, TFG also updated on trading for the three months to June and said Covid-19 had “a significant effect” on its businesses and on retail turnover for the three months.

The group’s consolidated retail turnover declined 43% for the three months ended 27 June 2020 when compared to the same period in the previous financial year, with “significant” trading disruptions caused by Government-enforced lockdowns and regulations on social distancing in all three of the company’s major operating territories – South Africa, the United Kingdom and Australia.

“The global economic environment remains constrained and consumers continue to experience significant economic pressure,” it said.

TFG operates more than 4,000 outlets and 29 brands, including G-star Raw, Relay Jeans, Hobbs Phase Eight, and Whistles.