Mike Arnold
Long only, small-cap, tech, growth at reasonable price

Foschini Group: Cheap Exposure To Emerging Market Growth In Africa

Foschini Group (OTCPK:FHNIY) ("Foschini" or "the company") is an undervalued holding company headquartered in Cape Town, South Africa.

Foschini is comprised of 14 retail brands, engaged in selling products that spread across the retail spectrum: men's and women's apparel, sports apparel, jewelry, accessories, cosmetics, cell phones and housewares. Foschini also holds a controlling 55% stake in RCS, a financial services provider, providing credit to over 1 million customers in South Africa, Botswana and Namibia.

The company recently announced it plan to reduce its RCS stake to less than 50%, then subsequently received an unsolicited offer from a bidder to acquire the entire 55% stake in mid-August. The potential RCS sale is a near-term catalyst, and combined with a...

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