Notable retail giant Shoprite has announced it is leaving Nigeria, no thanks to low sales occasioned by COVID-19 pandemic and stiff competition from local retail outlets.
This announcement is coming 15 years after it began operation in Africa’s most populous country.
In a statement on Monday, the Cape Town-based retail giant stated it has commenced a formal process to consider the potential sale of all or a majority stake in its supermarkets in Nigeria.
The company said the results for the year did not reflect any of their operations in Nigeria as it would be classified as discontinued operation.
It, however, indicated that potential investors were making overtures to it.
“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 a discontinued operation when Shoprite reports its result for the year,” the statement read.
South African operations contributed 78 per cent of overall sales and saw 8.7 per cent rise for the year.
Due to the coronavirus-induced lockdown, customer visits declined 7.4 per cent but the average basket spend increased by 18.4 per cent.
South African retailers have struggled in the Nigerian market and most recently Mr Price exited the market after Woolworths did same six years ago.