Gbenro Adesina
Shoprite Holdings Limited, incorporated in the Republic of South Africa, has announced on Monday August 3, 2020 that is it working out formal plans to leave Nigeria or sell a majority share of its operations in the country.
The company, which operates one of Africa’s biggest grocery stores, Shoprite, stated this in its operational and voluntary trading update for the year ended on June 28, 2020.
It stated, “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”.
The closure of the company’s business in Nigeria is likely connected with the lull in business across the world due to the coronavirus pandemic and its loss in sales due to the September 2019 Xenophobic attacks. The company had stated in its half year report for the 26 weeks to December 29 2019 that, “With regards to Nigeria, the impact of store closures and subsequent reduction in customer count, both during and after the September Xenophobic attacks, resulted in a difficult half with sales declining by 8.1% in constant currency terms”.
The imminent closure of Shoprite has continue to generate reactions from Nigerians. While some are unhappy to see the groccery store exit the country, some believe that it will benefit Nigeria more.
A former senator, who represented Kaduna Central in the 8th National Assembly, Shehu Sani, tweeted, “If Shoprite wants to stay,they can stay; if they want to go, they can go; it will help local supermarkets to grow”.
Also, a former Bayelsa State senator, Ben Murray-Bruce, tweeted, “Once again, the planned departure of Shoprite from Nigeria emphasises why as Nigerians, we must buy and consume Nigerian products if we must grow our economy and strengthen the Naira”.
A Twitter user said, “If Shoprite is leaving Nigeria where would Ilorin people be snapping now?”, while another said, “Shoprite leaves Nigeria? Ahh.. Which tourist centers will Ibadan people now use? Did they consider them at all? This is unfair”.
Another person tweeted, “I will be leaving with Shoprite too. Thank you for your time Nigeria”, while another said, “Now, Shoprite wants to leave Nigeria and everyone is still suffering and smiling like nothing is going on? This government is killing businesses. Who would want to invest in a failed country?”
Special Assistant to President Muhammadu Buhari on Digital and New Media, Tolu Ogunlesi, tweeted, “Looks like the Shoprite Sale deal is much much closer to conclusion than assumed. But wait for official announcements thanks. A group of Nigerian investors are taking it over to build a world-class Nigerian retail brand. I wish them the very best!”
The company opened its first Nigerian store in the Victoria Island area of Lagos in December 2005.
