Mr Price has completed one of the boldest moves in its history, taking full control of NKD, a European value retailer, in a deal that has divided the market and saddled the JSE-listed group with billions of rand in fresh debt. The Durban-based clothing chain confirmed that NKD joined the group in March, formalising an acquisition it first announced in December.
The transaction saw Mr Price buy 100% of Pegasus Group Holding GmbH, which trades as NKD's retail business, for €487 million — roughly R9.6 billion at the time it was struck. It was funded through a mix of cash and debt, and adds more than 2,100 stores across Germany, Austria, Italy, Croatia, Slovenia, the Czech Republic and Poland to the group's footprint. NKD generated net sales of €684.57 million in 2024.
A deal that split the market
The reaction was anything but warm. Around R6 billion was wiped off Mr Price's market value on the day the deal was first announced, and prominent fund managers — including 36ONE Asset Management and Benguela Global Fund Managers — have been vocal critics. Benguela flagged that NKD's margins likely sit at just 1% to 2%, well below the 9% to 14% Mr Price typically earns, while the deal loads the balance sheet with debt. The group now carries around R7 billion in interest-bearing loans.
Management is unmoved. "Clear areas of focus have been identified with the NKD management team, who are committed to achieving the guided forecasts communicated to investors," the group said.
Solid results, cautious outlook
The European bet lands on the back of a reasonable year at home. For the 52 weeks to 28 March 2026, Mr Price grew total revenue by 4.2% to R42.7 billion and lifted normalised headline earnings per share by 7.7%. It declared a final dividend of 592.8 cents a share, holding its payout ratio at 63%, and opened 196 new stores over the year.
Chief executive Mark Blair struck an optimistic but measured tone, pointing to South Africa's long-term prospects while warning that the conflict in Iran had injected short-term uncertainty. For the 2027 financial year, the group plans R1.1 billion in local capital spending and about 180 new stores, with a further €24 million (R454 million) earmarked for roughly 150 new NKD stores in Europe.
