JD Group acquires Unitrans, Steinbuild

2011-03-14 11:09

JD Group has acquired Unitrans Automotive and Steinbuild from the Steinhoff Group, executive chairperson David Sussman said today.

“This transaction has the potential to substantially grow financial services in the JD Group,” Sussman said in a statement.

Unitrans Automotive, valued at R3 billion, is one of the four largest motor vehicle retailers in the country and owns Hertz Car Rental in South Africa.

Steinbuild owns Timbercity and Pennypinchers building supplies and DIY businesses.

Steinhoff Africa Holdings Limited would acquire a 26 percent stake in JD Group in exchange for these businesses.

“Since 2008 JD Group has been restructuring to create an independent financial services business, separate from its furniture and cash retail operations.

“This was successfully completed in 2010, but in order to maximise the benefits, the financial services business requires critical mass.”

Sussman said this transaction could potentially grow financial services.

“60% of applicants for finance for entry level vehicles rejected by the banking sector are consumers in our target market, which are our customers.

“We have carried out in-depth research, which indicates that about 25% of those rejected would qualify for finance from the JD Group.

“Ownership of a substantial motor dealership business now provides us with a channel to access this market,” said Sussman.

Pennypinchers and Timber City sell about 70% of their goods on credit.

“This too fits within the group’s financial services vision.”

JD Group would sell its Polish furniture retail business, Abra, to a Steinhoff associate, “as it more closely fits with Steinhoff’s international structure and was JD Group’s only non Southern African investment”.

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