The veteran founder of a frozen food chain in Iceland has struck arguably the best discount deal for supermarkets: a £ 50 million ransom, with the purchase price reduced by millions of pounds.
Sky News has learned that Malcolm Walker has agreed with the South African conglomerate Brait to early payment of the remaining two installments of £ 115 million.
Under the deal announced in June, Brait said it would transfer its 63% stake in Iceland to Mr Walker, who started the business exactly 50 years ago, and Iceland’s CEO Tarsem Dhalival.
The first tranche of £ 60 million was paid under the deal, with £ 26.9 million to be paid on July 30 next year and £ 28.1 million 12 months later.
“NewCo may settle deferred payments in whole or in part at any time on or before these payment dates, in which case the early repayment discount will apply,” it said in a statement in June.
Sources said both parties have agreed to pay the full amount now at a discount of approximately £ 5 million to the total purchase price, which is said to have been settled.
Brait is said to have pushed for an early payment of the outstanding £ 50 million as it struggles to save value from its other major UK retail asset, fashion chain New Look.
Brait also controls Virgin Active, which has been hit hard by the coronavirus pandemic in its main markets in the UK and South Africa.
Iceland trades in nearly 1,000 stores across the UK but faces growing competition from price-conscious competitors like Aldi and Lidl, as well as consumer goods retailer B&M, which now sells cheap frozen food.
Iceland declined to comment, and Brait could not be reached for comment on Sunday.
