Nigeria’s largest modern retailer, Shoprite said it will be selling its stakes in the Nigerian operation after the operating fortunes dwindled.
Shoprite had exited Kenya recently for the same reason.
In a statement by the company the group said:
“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.”
Apart from the tough economic environment, Shoprite has also been confronted by more competition from foreign and local rivals in the last three years.
Earlier this year, Mr Price Holdings (MRP), said it will be shutting down its operations in Nigeria.
This development is coming three quarters after it shuttered its operations in Australia, two years after it was floated.
Before the winding down of its operations in Nigeria, the casual wear retailer was operating about six outlets located across five states.
In a notice issued to its employees before the lockdown in March, the company said it was forced to take the painful decision after its business in the country was operating at a loss and there were no respite in sight.
Alongside Truworths, Woolworths, Mr. Price entered Nigeria in 2011 trailing the nationwide expansion of Shoprite Holdings across major malls in the country.
While Mr. Price continued to run its operations in the face of series of economic challenges and a recession in 2016, Truworths and Woolworths have edited the country, citing tough operating conditions.
A financial analyst with interests in the retail and fashion industry told PageOne.ng that Mr. Price could have made the decision as a result of the change in importation policies or the government that prevents finish goods importers from accessing forex at the official Central Bank rate. This is perhaps, a major blow to Mr. Price coupled with periodic forex droughts that restrain foreign-owned companies from repatriating their revenue abroad.
People with the knowledge of the matter said Mr. Price has closed all its stores in Nigeria except its store in Ikeja which would close down by August.
The Nigerian subsidiary is fully owned by MRP Holdings of South Africa. The company is listed on the Johannesburg Stock Exchange, JSE.