Shoprite commences process of sale of operations Nigeria

Shoprite commences process of sale of operations Nigeria

Monday, August 3, 2020 10:38 am


South Africa grocery retailer, Shoprite, has announced that it is considering selling all or parts of its Nigerian operations to yet to be named investors.
Shoprite, which has been operating in Nigeria for 15 years announced the commencement of a formal process to  sell of all or a majority stake in its supermarkets in Nigeria in its trading statement for the 52 weeks ending June, 2020 released on Monday.
As a result, the company said the statement does not reflect any of their operations in Nigeria as it will be classified as discontinued operation.
It said, “Following approaches from various potential investors, and in line with our re-evaluation of the group’s operating model in Nigeria, the board has decided to initiate a formal process to consider the potential sale of all, or a majority stake, in Retail Supermarkets Nigeria Limited, a subsidiary of Shoprite International Limited.
As such, Retail Supermarkets Nigeria Limited may be classified a discontinued operation when Shoprite reports its result for the year,” the statement read.

Also, CNN  cited a statement by the company on Monday, saying that Shoprite is re-evaluating its operating model and has been approached by many investors willing to take over its Nigerian stores.”It added that it has decided to initiate a formal process to consider the sale of all or a majority stake in its retail supermarkets in the country. Retail Supermarkets Nigeria Limited may be classified as a discontinued operation when ShopRite reports its results for the year. Any further updates will be provided to the market at the appropriate time,” read the statement.
The company, with more than 2,900 outlets across Africa, according to CNN, also released its trading statement for 52 weeks to end June. In the trading statement, it announced that its South African division grew by 8.7% while sales at its supermarkets outside South Africa (excluding Nigeria) fell by 1.4%.
CNN went further: “Since its launch in December 2005, ShopRite has expanded its stores across Nigeria, employing more than 2,000 people, many of whom are Nigerian.
The company also built relationships with multiple Nigerian suppliers, small businesses, and farmers as a way of supporting local job creation, its website said.
Over the years, the company has faced a number of challenges in Nigeria’s tough business climate, including the looting of its stores in response to xenophobic attacks against other African nationals in South Africa.
In 2019, protesters set fire to many entrances leading into a busy mall housing ShopRite, looting groceries and toiletries from the Supermaket in Lagos, Nigeria’s commercial center.
Nigerians have taken to social media to express concerns about possible job losses if the retail giant closes its operations in the country.
“So Shoprite is leaving Nigeria, thousands of people will be without jobs now, other thousands depending on those people’s incomes,” one Twitter user wrote.
ShopRite’s planned exit comes after Mr. Price, another South African brand, closed its Nigerian stores, according to a Bloomberg report.
The company CEO, Mark Stirring, announced that Mr. Price closed its market in the country after reevaluating its strategy, to focus on its home market in South Africa.”
Although, CNN wrote that it had reached the company for a comment and was awaiting a response, Vanguard got the reaction of ShopRite Nigeria, debunking the story making the rounds that it intends to close shop in Nigeria. The Country Director for Chastex Consult, Ini Archibong, in a telephone conversation with Vanguard, said: “Shoprite is not leaving Nigeria. “We have only just opened to Nigerian investors which we have also been talking to just before now. We are not leaving, who leaves over a $30billion investment and close shop? It doesn’t sound right.
“We only gave this opportunity to Nigeria investors to come in and also help drive our expansion plan in Nigeria. So we are not leaving. I have tried to say this to many people as I can. There should be no panic at all and all of that. There is no truth in that report.”

 

Loading...

Join The Conversation

What do you think?

This site uses Akismet to reduce spam. Learn how your comment data is processed.