ShopRite And Mr. Price Are Pulling Out of Nigeria: Reason May Not Be Far Fetched. Find Out More!!!
Reports say that South Africa’s grocery retailer, ShopRite, is leaving Nigeria soon. Apparently, there was an update filed at the Johannesburg Stock Exchange on Monday morning, August 3, where plans of discontinuing its operations in Nigeria was announced.
Shoprite opened its first store in Lagos in December 2005. International supermarkets (excluding Nigeria) contributed 11.6 per cent to group sales and reported 1.4 per cent decline in sales from 2018. South African operations contributed 78 per cent of overall sales and saw 8.7 per cent rise for the year. The company said it had been approached by potential investors willing to take over its Nigerian operations. This resolve may have included the fact that sometime in April, according to the report from Nairametrics, Shoprite Nigeria lost 8.1% of sales in the H2 of 2019, which was related to the September 2019 xenophobic attacks.
Following the report from SaharaReporters, the company said it was considering an outright sale of its operation or selling a majority stake in its Nigerian subsidiary. “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 results for the year. Any further updates will be provided to the market at the appropriate time,” part of the update read.
Meanwhile, Mr. Price also ‘wants out’. Report says that the company has already closed 4 of 5 retail outlets in Nigeria. They want to focus on the South African market and it is likely because of the decline in profit.
