Mr Price digs in on R9.7bn NKD European deal

Mr Price Group says it intends to host a capital markets day to set out in greater detail the rationale for its proposed acquisition of European value retailer NKD, as the board moves to defend a transaction that has triggered a sharp sell-off in the share price and vocal shareholder opposition.

In a Sens filing on Tuesday, the group said management and the board “re-affirm the strategic rationale” for the deal and the due diligence process followed, adding that disclosure is currently constrained by regulatory and suspensive conditions.

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According to Mr Price, it plans to host a capital markets event in the latter part of the first quarter of 2026 to provide more detail on value retail in Europe, NKD’s positioning and its expected medium- to-long-term performance.

Mr Price announced on 10 December 2025 that it would acquire 100% of Pegasus Group Holding GmbH, which trades as NKD Group GmbH, through an indirect wholly owned German subsidiary, in a transaction valued at about R9.7 billion.

The market reaction was swift, with its shares plunging more than 15% on the day of the announcement and have since continued to slide, leaving the stock down close to 42% year to date.

Mr Price share price 

The group says while the transaction is contractually complete, closing remains subject to regulatory approvals.

Criticism 

The announcement of the deal has led to some shareholder unease.

Moneyweb reported earlier this month that one of the company’s largest shareholders, 36One Asset Management, has publicly criticised the board in an open letter, warning that South African retailers have a “terrible history of value-destructive offshore acquisitions”.

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In the letter, 36One co-founder Cy Jacobs said the immediate share price reaction was a clear signal of market scepticism about the deal’s value and risk profile, and called for structured engagement with the board before the transaction becomes irrevocable.

Jacobs also questioned the valuation and strategic logic of the acquisition, noting that NKD had generated losses for several years before returning to profit more recently, and raised concerns about competitive pressures from ultra-low-cost online players such as Shein and Temu.

Similar criticism has been echoed by market commentators. In an analysis in his Supernatural Stocks podcast on Moneyweb, The Finance Ghost described the transaction as “tone deaf”, arguing that Mr Price was pursuing a large offshore acquisition at a time when sentiment towards South African assets had improved significantly.

The commentary highlighted the size of the deal relative to the group, the decision to buy 100% of the business from a private equity seller, and what he described as limited financial disclosure given the scale of the investment.

Mr Price says it remains committed to transparent engagement. The group said it is making an “extensive effort” to progress regulatory approvals and closing requirements, and will provide further information to shareholders once disclosure constraints have been lifted.

Read: SA retailers suck at going offshore – here’s why

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