The emerging markets focussed private equity firm Actis was considering acquiring Tekkie Town, a South African footwear and sportswear retailer, founded in 2001 with over 300 stores in South Africa and Namibia. The founder-owned firm had recently undergone rapid expansion across South Africa and into neighbouring SADC countries.
Actis was in the process of considering an investment in Tekkie Town, and asked Pragma to construct and manage a thorough commercial due diligence programme. Actis wished to assess Tekkie Town’s potential to grow as a retailer through store rollout and like-for-like growth in the South African market.
Analysed historical and forecast market trends, in conjunction with a local expert, to understand likely market impacts on Tekkie Town’s business plan
Conducted qualitative and quantitative primary consumer research, including exit interviews at 22 Tekkie Town stores, an online market survey of South African footwear buyers, and mobile phone surveys and six focus groups with Tekkie Town customers
Reviewed historical retail and product trading performance metrics as well as operational processes to identify further opportunities for the business
Developed a store rollout model to help inform the optimal pace of new store openings
I am excited to have Actis on board. With its excellent track record of investing in South Africa and deep understanding of the African retail market, I am confident that together we will develop the business into a customer centric operation.
Pragma’s analysis and expertise in retail informed Actis’s decision to take a significant minority stake in the business, which will help to fund further expansion in Southern Africa and possibly into West and East Africa.