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EXCLUSIVE-Persianas to buy Shoprite's Nigerian business-sources

Published 14/04/2021, 09:59
© Reuters.

(Adds Shoprite share price gain)
By Chijioke Ohuocha
ABUJA, April 14 (Reuters) - Nigerian property group
Persianas is buying Shoprite's SHPJ.J business in Nigeria as
the South African retailer retreats from other African markets,
three banking sources told Reuters on Wednesday.
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 have been
disclosed. Banking sources told Reuters that Persianas Properties
emerged as the buyer after a bidding process and the company is
arranging debt for the buyout. The Palms shopping mall,
Persianas' flagship mall, houses a Shoprite store in the West
African country's commercial capital, Lagos.
Shoprite has more than 25 retail stores across Nigeria,
including some of the largest in West Africa.
Persianas and Shoprite declined to comment on the deal.
MBO Capital and KPMG advised Persianas while FBN Quest, a
unit of FBN Holdings FBNH.LG , is arranging debt, the sources
said, adding that Investec INVP.L advised Shoprite.
Shoprite shares, which fell 1.20% in early trade, recovered
ground to stand 0.31% higher after the news.
South Africa's biggest grocer has been reviewing its
long-term options across Africa as currency devaluations, lower
commodity prices and high inflation have hit household incomes
and weighed on earnings.
This has led to the company exiting Kenya and Nigeria,
restricting capital allocations to its supermarkets outside
South Africa and instead investing that money in its home
business to take advantage of its dominance in the discount
grocery market and growing share in premium food.
Nigeria, Africa's most populous country which has the
continent's biggest economy, is grappling with double-digit
inflation. Galloping food prices have heaped financial pressure
on households already faced with a shrinking labour market and a
stagnant economy at a time of mounting insecurity. Shoprite has said it is in the process of concluding a
franchise agreement for the brand to remain in Nigeria as well
as a services agreement to provide support to the new
shareholders with operating the outlets.

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