Persianas, a Nigerian property group, is buying Shoprite’s Nigerian business after the South African retailer decided to retreat from other African markets, a report has revealed.
Three banking sources noted that Shoprite, which has been operating in the country for 16 years, has concluded arrangements to dispose of its shares to the property group, according to Reuters.
It said the board decided to formally exit its operations in Nigeria due to unfavourable market conditions.
“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 as a discontinued operation when Shoprite reports its result for the year,” the statement read.
The South African-based company announced in its latest financial report for December 2020, which was published on its website, that it has concluded the sale of its Nigerian outlets to new investors.
According to the company, it is disposing of a 100 per cent equity stake in its Nigerian retail supermarkets.
Shoprite, with more than 2,300 stores across Africa, is awaiting regulatory approval on the sale of its Nigerian supermarket operation, though no further details about the deal have been disclosed.
It, however, noted that its management was in the process of concluding a franchise agreement for the Shoprite brand to remain in Nigeria, as well as an administration and services agreement to provide support to the new shareholders with operating the outlets.