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SA retailer Shoprite mulls Kenya entry

shoprite

Shoppers outside a Shoprite outlet in Kano, northern Nigeria. AFP FILE PHOTO | AMINU ABUBAKAR

Summary

  • Shoprite says it's “in talks with some of the property owners” in Kenya “but nothing has been signed” yet.
  • If successful, this would be the first time Shoprite sets shop in Kenya.
  • Shoprite has a strong presence in Central, Southern and West Africa.

South African retail giant Shoprite is eyeing the gap left by a faltering Nakumatt, the largest supermarket chain in Kenya, to make its debut in the country.

Gerhard Fritz, who runs Shoprite business outside South Africa, told Bloomberg the retailer was “in talks with some of the property owners” in Kenya “but nothing has been signed” yet.

If successful, this would be the first time Shoprite sets up shop in Kenya.

It would join the likes of Massmart – which operates in Kenya under the brand name Game – and France-based Carrefour, the world's second largest retailer by revenues, who’ve entered the country in recent years.

READ: Foreign retail chains get a foothold in Kenyan market

It would also be a twist in change of fortune for the two African retailers: In 2014, family-owned Nakumatt took over Shoprite stores in Tanzania as it expanded regionally, before it was hit by financial woes.

READ: 19 landlords sue Nakumatt for Sh600m rent arrears

Debt burden

Kenyan supermarket chains have staggered in recent years under the weight of growing debt burdens to their suppliers and gross mismanagement.

Court documents seen by the Business Daily showed that Nakumatt owed its debtors more than Sh31 billion.

Shoprite, which already operates in Tanzania and Uganda and has a strong presence in Central, Southern and West Africa, said it is on course to take over two of Nakumatt’s sites in Uganda.

This will push its presence on the continent to 419 stores in 14 countries in sub-Saharan Africa, excluding South Africa.

READ: S. Africa’s Shoprite replaces Nakumatt at Ugandan mall

ALSO READ: Nakumatt seeks nod to sell 51pc of Tanzania unit in plan to cut debt