Pick n Pay is to replace its current pyramid ownership structure with a simpler, more modern single share listing. Shareholders will vote on 25 July. The pyramid structure was introduced in 1981 by the Ackerman family to prevent a hostile takeover.
The pyramid, which entrenches family control, is structured in the form of a dual listing on the JSE. The Ackerman family owns more than 50% of shares in Pick n Pay Holdings Ltd , which in turns owns more than 50% of shares in Pick n Pay Stores Ltd.
This type of structure has come over time to be seen as cumbersome and outdated, and the Ackerman family has therefore come forward with a proposal which would unbundle the pyramid structure while retaining family control. The proposal has been approved by both Pick n Pay Boards.
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In essence, the proposal will:
- collapse the pyramid by unbundling all shares in Holdings, with Holdings shareholders receiving shares in Stores on a pro rata basis;
- mean that all shareholders in Pick n Pay will hold their shares in a single Stores listing. Holdings would delist from the JSE, and would be wound up;
- allocate to the Ackerman family a new class of unlisted voting shares in Stores (“B Shares”). This will ensure that the Ackerman family continues to have a controlling interest in the company.
Commenting on the proposal, Pick n Pay chairman Gareth Ackerman said: “Unbundling the pyramid will streamline the Pick n Pay Group into one listed entity, with benefits for the company and potentially for all shareholders.
Over time, the simpler structure should improve Pick n Pay Stores’ appeal to investors, which could in turn help our long-term growth strategy. The proposal will maintain Ackerman family voting control over Pick n Pay.  The family has had control of the company for almost 50 years.”
