(MENAFN- AFP) Britain's budget chain Poundland on Friday snapped up rival group 99p Stores for £55 million ($84 million, 74 million euros) in a deal underlining the nation's booming discount retail sector.
The group, which floated on the London stock market last year, announced in a statement that it has agreed to buy the family-owned 99p Stores chain in a cash-and-shares deal.
Poundland, which charges one pound per item, operates a network of almost 600 stores across Britain and Ireland with an estimated five million customers per week.
Rival chain 99p Stores, which sells items at 99 pence each, has 251 branches and around two million weekly customers.
"This is a good deal for both businesses and will benefit customers and shareholders," said Poundland chief executive Jim McCarthy in the statement.
"Through working together, Poundland will improve choice, value and service for 99p Stores' customers, bringing Poundland's proven know-how and range to 99p Stores.
"We also believe that we can improve the performance of the 99p Stores estate and generate further value for Poundland's shareholders."
Poundland will pay £47.5 million in cash plus £7.5 million in new shares, while the deal will be partly funded by a share placing but remains subject to regulatory approval.
Discount chains boomed in Britain during the economic downturn, as consumers tightened their belts to save cash, and remain popular.
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