Outgoing Pick n Pay Chairman Gareth Ackerman (Courtesy of Pick n Pay)
After nearly 60 years, the Ackerman family is giving up control of Pick 'n Pay.
The retailer announced on Monday that Ackerman Investment Holdings (AIH) would sell a majority stake in the company following a rights issue.
“AIH and its related and mutually associated persons (the Ackerman family) have agreed to waive their majority voting rights in Pick n Pay, however the specific structure has yet to be finalised, meaning that following the planned rights issue their voting power will be just below 50 per cent,” the group said in a statement.
The family will also immediately relinquish their right to nominate the chairman, CEO and chief financial officer.
Gareth Ackerman, who has been chairman for 14 years, will step down next year. He will remain on the board, along with his siblings Suzanne and Jonathan Ackerman.
Gareth Ackerman said in a statement that he felt “the time is right to let new blood take over.”
“The Ackermans have been considering for some time the changing operating environment at Pick n Pay and the need for renewal, including at executive level. To quote my father's favourite saying, 'we need to listen to what tomorrow is whispering.' The recent challenges facing the business have proven the perfect opportunity to accelerate the renewal process.”
Pick n Pay on Monday reported tough results for the year to the end of February.
The group's operating profit fell by more than 87%, with Pick n Pay stores suffering an operating loss of R1.5 billion.
Meanwhile, the lower-priced brand Boxer posted an operating profit of R1.9 billion.
The late Raymond Ackerman, who passed away in September last year, bought the first four Pick n Pay stores in Cape Town in 1967.
The group grew rapidly to become the country's largest retailer and pioneered retail initiatives such as “no-name” food brands and in-store banking.
But in recent years, the company's performance has faltered and it has seen multiple CEO changes as Shoprite has become a dominant force in the market.
