Ackerman Family Steps Down from Control of Pick n Pay After 57 Years

After more than half a century at the helm, the Ackerman family is relinquishing control of Pick n Pay, one of South Africa’s largest and most iconic retailers. This significant shift comes amid mounting financial challenges for the company, culminating in a staggering loss of R3.2 billion for the financial year ending February 2024. The family’s decision marks the end of an era, with implications that could reshape the future of the retail giant.

Financial Struggles and Strategic Shifts:
Pick n Pay’s recent financial woes have been well-documented. Despite strong performances from its Boxer and Pick n Pay Clothing divisions, the core grocery business has struggled. This has resulted in a R2.8 billion non-cash impairment on the assets of company-owned stores, driving the group to implement a two-step capital raise plan. This plan, although successful, highlighted the severity of the situation and the need for drastic changes.

One of the most notable outcomes of this financial restructuring was the reduction of the Ackerman family’s voting rights from 52% to 49%. While a seemingly minor decrease, this change means the family no longer holds the majority control over the company—a stark contrast to their previous position of power.

Leadership Changes and the End of an Era:
The Ackerman family’s influence over Pick n Pay has been longstanding, beginning with Raymond Ackerman’s purchase of the first stores in 1967. Raymond, who was ousted from his previous position at Greatermans, founded Pick n Pay with a combination of severance pay, a bank loan, and the support of friends. His initial investment of R620,000 in four small Cape Town stores laid the foundation for what would become a retail empire.

Raymond Ackerman stepped down as chairman in 2010, passing the torch to his son, Gareth Ackerman. However, with the recent financial difficulties, Gareth has also decided to step down, signaling a major leadership shift within the company.

The Legacy of Pick n Pay’s Founders:
The story of Pick n Pay is intertwined with the legacy of the Ackerman family. Raymond Ackerman’s vision and entrepreneurial spirit were instrumental in transforming a small chain of stores into a national powerhouse. His success in one of South Africa’s earliest private equity deals, which involved 50 investors and led to Pick n Pay’s listing on the JSE in 1968, is a testament to his business acumen.

As the Ackerman family steps back, Pick n Pay faces a new chapter in its history. The challenges ahead are significant, but so too is the foundation laid by its founders. The retail giant’s future now rests in the hands of its broader leadership and stakeholders, as they navigate the complexities of the current retail landscape.

Conclusion:
The departure of the Ackerman family from Pick n Pay’s leadership marks a watershed moment in South African retail history. As the company strives to overcome its financial challenges, the legacy of its founders will undoubtedly continue to influence its path forward. The next few years will be crucial for Pick n Pay as it adapts to new leadership and seeks to reclaim its position as a leading retailer in the country.