Shoprite, Africa’s largest food retailer, is looking to dispose of its Malawian business to domestic players, 25 years after it first invested in the country.
Malawi’s antitrust body, the Competition and Fair Trading Commission, in a public notice said on Friday it had received an application from the Karson Investment Trust over the mooted purchase of Shoprite’s assets in the country.
“In Malawi, the target [Shoprite] operates a chain of supermarkets across the three major cities in Malawi. The target also offers a range of products and services, including holding and lease of properties,” the notice reads.
“Upon completion of the proposed transaction, the acquirer intends to operate a separate company called ‘Shopwise Trading Limited’, which will be conducting retail trading of groceries and other merchandise.”
Shoprite, which has been on an aggressive expansion of its footprint in SA, its largest market, made a foray into Malawi in 2000, but has not been as aggressive in opening new stores in the country.
The group, worth R156bn, has five stores in Malawi. The value of the transaction is not yet known.
The group, the largest SA retailer by market capitalisation, sales, profit, number of employees and customers, has grown to 3,417 stores across 10 African countries.
The retail major has 40 stores in Angola, 24 in Mozambique, 42 in Zambia, 86 in Namibia, 38 in Eswatini, 25 in Botswana and 25 in Lesotho.
The group’s non-SA supermarkets earned R11bn in sales in the 26 months to end-December, with the lion’s share of the company’s revenue still coming from SA, where it has more than 2,500 stores that raked in R107bn in sales in the period under review.
The Cape Town-based retail group has not been shy to pull out from markets in which it has not achieved scale.
A few years ago the group sold its Nigerian operations to local firm Ketron Investment, a subsidiary of property firm Persianas Investment, for an undisclosed amount.
In 2021 Shoprite also exited Uganda, Kenya, Madagascar and the Democratic Republic of Congo as part of its strategic review process of its capital allocation to its non-SA operations.
In SA, the company continues to scale up. Over the past two weeks, the group opened 16 new outlets across the Western Cape, the Eastern Cape and Gauteng, creating 358 new job opportunities.
Shoprite declined to comment on its Malawian operations.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.