Sunday, August 30, 2009

Shoprite to buy Zimbabwe retailer

Shoprite Holdings Ltd., South Africa’s biggest food retailer, said it will “consider” buying businesses in Zimbabwe to expand its operations on the rest of the continent.
Shoprite was responding to a report in Zimbabwe’s Herald newspaper today that said the company is seeking a controlling stake in OK Zimbabwe Ltd. OK, which has a market value of $230.6 million, is Zimbabwe’s second-biggest supermarket chain after Kingdom Meikles Africa Ltd.-owned TM Supermarkets (Pvt) Ltd.
Cape Town-based Shoprite will “consider such opportunities in Zimbabwe if the economic conditions in the country prove to be conducive to the expansion of its operations,” Marketing Director Brian Weyers said in an e-mailed response to questions. The retailer is “constantly looking at opportunities to expand its business across the continent.”
Calls to OK Zimbabwe’s offices in the capital Harare didn’t connect.
Shoprite, which posted a 27 percent jump in profit in the year through June, operates 102 stores in 16 countries outside of South Africa, including a grocer in Zimbabwe’s second-biggest city, Bulawayo. Chief Executive Officer Whitey Basson said on Aug. 25 the retailer is in talks to open 14 stores in Nigeria and two in Angola, and is considering investing in Mauritius and Madagascar.
Zimbabwean President Robert Mugabe signed a power-sharing agreement with opposition leader Morgan Tsvangirai in February, with the aim of drawing up a new constitution and holding elections within two years of that. Zimbabwe’s economy has been in recession for a decade after Mugabe seized white-owned commercial farms to give to black subsistence farmers.
Source: Bloomberg

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