Newsletter No. 09 / 19 March 2021
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Lectra enters into a Memorandum of Understanding to acquire GerberTechnology
By uniting, the two companies would become the ultimate Industry 4.0 partner for their customers.
Lectra announces its plan to acquire the entire capital and voting rights of US-based Gerber Technology. A key Industry 4.0 player in the fashion, automotive and furniture industries, Lectra designs smart industrial solutions – software, equipment, data and services – that help brands, manufacturers and retailers develop, produce and market their products.
The acquisition, if and when consummated, would al ow Lectra to complement its market position and continue to enhance its offerings based on Industry 4.0 technology that will enable its customers to boost the productivity and profitability of their operations. After the French work council of Lectra is consulted and the binding documentation is signed, completion of the acquisition shall remain subject to merger control clearance and other customary conditions and shall be submitted to Lectra shareholders for approval.
The proposed combination would occur at an opportune time for both companies and their customers. The current uncertain economic climate and unprecedented challenges that fashion, automotive and furniture companies are facing due to the COVID-19 pandemic make it more important than ever for them to transform, digitalize and optimize their operations.
For over 50 years, Gerber Technology has used its proprietary technologies and deep domain expertise to provide integrated software and automated hardware solutions to companies around the world, including over 100 Fortune 500 companies in 134 countries.
The strategic combination of Gerber Technology and Lectra will create a premier advanced technology partner,able to quickly meet changing customer needs and deliver even more value through seamlessly integrated solutions. Together, the two companies will have a large instal ed base of product development software and automated cutting solutions in operation, with a worldwide presence and a long list of prestigious customers.
Consolidating the two companies’ research and development capabilities will enable the combined company to accelerate development of Industry 4.0 technologies and help its expanded customer base seize the full potential of these innovations.
“It has been an honor to lead the transformation of Gerber Technology and create an efficient, comprehensive platform that enables our customers’ digital transformation initiatives. Gerber Technology and Lectra share along history of innovation and excellent customer service that, brought together, will create an even stronger company that provides best-in-class technology solutions and services to our customers global y,” says Mohit Uberoi, Chief Executive Officer, Gerber Technology.
The combined company’s broader global reach will allow it to boost service capabilities to customers around the world thanks to greater resources and the joint force of Gerber Technology and Lectra’s sales and support teams.
Integrating the technology of the two companies will endow them with the resources to anticipate and address rapidly changing market conditions.
“Today is a historic day for our companies that will bring tremendous opportunities for future growth. We will have investments in innovation and technological capabilities that wil be highly beneficial to the industry. They will allow us to create long-term value for our customers and our shareholders,” states Daniel Harari, Chairman and Chief Executive Officer, Lectra. “We’re delighted to welcome Gerber Technology’s group of talented professionals to the Lectra team. Unifying the two teams will showcase the strength of our fantastic employees. Together, we will be able to grow and expand the services we provide to our customers and help them accelerate their digital transformation.”
Key transaction terms
Under the proposed acquisition, Lectra would acquire al outstanding shares of Gerber Technology on a cash-free debt-free basis for an upfront payment of 175 million euros – through a combination of cash and debt – plus 5 million newly issued Lectra shares to AIPCF VI LG Funding, LP (“AIPCF VI LG”), an affiliate of American Industrial Partners that is Gerber Technology’s sole shareholder. This would represent a total amount of about 300 million euros based on Lectra’s closing share price on February 5, 2021. No contingent consideration is contemplated.
Gerber Technology’s revenues was 165 million euros in 2020.
Thanks to the strong value creation deriving from significant synergies, Lectra expects the transaction to be accretive for shareholders from 2022.
Upon closing, Daniel Harari would own c. 14.6% of the Lectra shares and AIPCF VI LG would own c. 13.3%.
Lectra’s Board of Directors would welcome a director representing AIPCF VI LG.
Daniel Harari would continue to be the Chairman and Chief Executive Officer of Lectra. Gerber Technology Chief Executive Officer, Mohit Uberoi, would assume special advisor to Daniel Harari role until end-2021.
Lectra’s shareholders would be invited to vote on the issuance of the 5 million new Lectra shares reserved to AIPCF VI LG at a dedicated Extraordinary Shareholders’ Meeting which is currently expected to be held on April 30, 2021. A report containing additional information will be made available to the shareholders prior to the Extraordinary Shareholders’ Meeting.
Lazard is acting as exclusive financial advisor to Lectra, and Latham & Watkins as legal counsel to Lectra.
Goldman Sachs is acting as exclusive financial advisor to AIPCF VI LG, and Ropes & Gray LLP, Baker BottsLLP and Gide Loyrette Nouel A.A.R.P.I. as legal counsel to AIPCF VI LG.
2020 results, update on the 2020-2022 strategic roadmap and guidance for the coming years wil be disclosedon February 10, 2021.
Lectra management will discuss the transaction, provide forward-looking guidance for the combined company upon closing of the transaction and answer questions from the financial community during the February 11, 2021 webcast Analyst Conference meeting in French starting at 8:30 am (CET – Paris).
For companies that breathe life into our wardrobes, car interiors, furniture and more, Lectra is crafting the premium technologies that facilitate the digital transformation of their industry. Lectra’s offer empowers brands, manufacturers and retailers from design to production, providing them with the market respect and peace of mind they deserve. Founded in 1973, today Lectra has 34 subsidiaries across the globe, serving customers in over 100 countries. With close to 1,800 employees, Lectra reported revenues of 280 million euros in 2019. Lectra is listed on Euronext (LSS).
Loskop Cotton Gin under new management
Johan Wolhuter, Jannie Terblanche and Louis Olivier
The management of Vaalharts Cotton, located in Hartswater, officially took over the management of the Loskop Cotton Gin in Marble Hall on Friday 12 March 2021. The cotton gin in Marble Hall will, during this transition period, be known as Vaalharts – Loskop Cotton. Vaalharts Cotton’s managing director, Louis Olivier and the chief financial officer, Johan Wolhuter, will also fulfil these respective roles at the “new” Vaalharts – Loskop Cotton. Louis Olivier has nine years of experience in running a cotton gin. He is a qualified agriculturist with 30-years of experience in the cotton industry, both as a farmer and a businessman. Johan Wolhuter is financially qualified and has been handling the financial management function at Vaalharts for the past two years.
All liabilities up to and including 12 March 2021, which were served under the previous management, will be managed accordingly on merit. The gin will continue to operate without any interruption in any of the services. The current rumours that Loskop Gin is closing its doors are therefore unfounded.
Vaalharts Cotton and Vaalharts – Loskop Cotton will be managed as two independent business units, each with its own board of directors.
Louis Olivier says he is well aware of the historical challenges that need to be addressed. However, he is optimistic that the South African cotton industry is core healthy, and with the application of a successful Vaalharts business model, they will once again develop the gin in Marble Hall to new heights. The Loskop Cotton Gin was upgraded in 2018. This upgrade brought its own challenges, which, along with Covid, forced the board to rethink the management of the gin. The board of directors, chaired by Jannie Terblanche, is satisfied that the processes to sort out the problems are in place and that relationships will be restored to stimulate the growth of the local cotton industry anew. Mr Terblanche said that he and the board of directors are grateful for the expertise Vaalharts Cotton brings to the table and for their willingness to assist the Loskop directors with their new strategic journey. He looks forward to the collaboration for the benefit of the greater cotton industry.
Louis Olivier believes in a transparent management style with open communication between the gin, the producers and all the role players in the cotton pipeline. He is convinced that cooperation and trust between role players is the basis on which the industry must build its success.
Connecting the Indian Ocean & African Textile & Apparel industry to the world
Abana is a new online textile and apparel platform for the Southern African region, the main objectives of which being to leverage the digital space to connect buyers and sellers, develop local and international trade, and grow demand for local, regional, and African production whilst taking advantage of Africa’s duty-free entry into the EU, US & African markets.
The Abana Digital Marketplace, therefore, consists of a database of buyers and sellers from across the world creating a virtual space for buyers and sellers to advertise opportunities & post requests.
Economic – Diversify your supply chain & protect it from geo-political risks.
Environmental – Consumers & investors are demanding ethical practices. Africa is a dynamic opportunity to re-imagine the supply chain with emerging compliant and forward-thinking players in the region.
Social -Africa has a wealth of textile expertise & cultural heritage waiting to be tapped into. Be on the forefront of social change & provide opportunities to positively impact communities
Countries part of Abana
The following countries are currently part of the Abana network:
Mauritius, Madagascar, Morocco, South Africa,
Swaziland, Lesotho, Botswana, Tanzania,
Tunisia, Egypt, Ethiopia
Coming soon: Kenya, Uganda
USA, UK, Germany, Austria, Switzerland,
Benelux, Scandinavia, Italy, Eastern Europe,
Russia, South Africa
Coming soon: France, Portugal
How can Abana work for you
The Abana digital marketplace will enable South Africa manufacturing companies to access a new international customer network and to develop new export markets and client opportunities in both the clothing and footwear sectors.
Search our worldwide database consisting of Buyers, Input suppliers & Service providers (logistics, finance, QA, consulting, etc.)
Connect with the whole apparel ecosystem
In addition to accessing the Abana supplier database, you will also be able to access value added services for on the ground support like compliance management, QA, In-line QC, AQL, critical path management, merchandising, sourcing – all these can be tailored to your specific needs / requirements.
What is needed to be part of Abana
In keeping with Abana’s social compliance vision of supporting and promoting sustainable development in the African apparel ecosystem, the Abana supplier validation process ensures that all suppliers marketed on the platform are properly screened, vetted, and based on buyer’s requirements, the platform ensures that all the necessary compliance and qualifying criteria is met and maintained.
Thus, to become a member as a garment maker or input supplier, prospective businesses should have an up-to-date compliant certificate.
Certifications recognised are listed below, whilst any other valid certificate will be reviewed on a case by case basis.
BSCI, B Corporation, SMETA, SA8000, Fairwear, ISO, WRAP
The Abana platform and solution could not have been launched at a better time and we are sure this can be of immense benefit to retail companies by developing their local and regional sourcing footprint while offering new export markets for local manufacturing companies in this new digital environment.
For more information log onto www.Abana.mu
Woolworths – completion of the sale
Further to the announcement published by the Company on the Stock Exchange News Service on 21 December 2020 with regard to the sale of the David Jones Properties Pty Limited Elizabeth Street property (Property Sale), WHL is pleased to announce that the condition precedent to the Property Sale has been fulfilled and the transaction has been completed.
In accordance with the previous announcement, the proceeds of the Property Sale have been applied towards the repayment of debt in Australia, pursuant to the WHL Board’s review of the capital structure of the Australian entities. In addition, the Property Sale and refinancing have facilitated the separation of the combined Australian debt and financing facilities of the David Jones Pty Limited (“David Jones”) and Country Road Group Pty Limited (CRG) groups, inclusive of the termination of the cross guarantees between the two groups. The David Jones and CRG groups are now financed separately, save for immaterial support from David Jones to CRG as a result of the total proceeds of the Property Sale being received in David Jones. This support is expected to be unwound in the near term.
Mr Price – acquisition of Yuppiechef
Mr Price announced that it has entered into an agreement to purchase 100% of the issued share capital of the group of companies comprising the Yuppiechef business (“Yuppiechef”), a privately-owned South African omni-channel retail business primarily focused on kitchenware.
Yuppiechef was founded in 2006 with a vision to build a platform for the distribution of aspirational kitchen and homeware brands. The business has two primary operations, namely: Yuppiechef Online, the retail division comprising the online platform and 7 stores, as well as a wholesale division, which develops, and imports branded goods for wholesale distribution. It commenced operations as a pure e-commerce company and since 2017 has transitioned into an omni-channel retail platform. The retail division represents 85% of turnover (70% via e- commerce) and has been a pioneer of online retail in South Africa, consistently winning awards throughout its history. Most recently in 2019, Yuppiechef was voted ‘Digital Company of the Year’ at the South African National Business awards and ‘Best Independent Retailer Store Design’ at the SACSC Retail Design & Development awards.
Meets investment criteria
Did you know……..
“Volume-based business models simply cannot become sustainable” (Los Angeles Times, 2019)
It’s no secret that fast fashion’s modus operandi is to produce as much as possible as cheaply as possible. To make the fast fashion industry eco-friendly, it needs to focus on quality rather than quantity. You know, like its much nicer counterpart, slow fashion.
“Less than 11% of brands are implementing recycling strategies for their items” (Peppermint Magazine, 2019)
Some fast fashion retailers have introduced recycling programs that give customers a store discount in exchange for their old clothing. Most of these items never get recycled. But, offering discounts does act as a stimulus to drive more sales …
To Advertise….. Click here to see fact sheet with advertising rates.
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