Corporate News
A Nakumatt outlet. The retail chain will take over three Shoprite stores in Tanzania. Photo/FILE
By SIMON CIURI
In Summary
- Fair Competition Commission of Tanzania confirmed that it had given a green light for the transaction that will see Nakumatt stores in Tanzania increase to four.
- The acquisition has been valued at about Sh4 billion.
- Shoprite exited Tanzania after about 12 years in the country after being accused of importing the bulk of its products from its mother company in South Africa.
The Tanzanian competition watchdog has cleared
Nakumatt’s bid to take over three stores owned by South African retailer
Shoprite in Dar es Salaam and Arusha, moving the buyout closer to
conclusion.
SHARE THIS STORY
The Fair Competition Commission (FCC) of Tanzania Wednesday
confirmed that it had given a green light for the transaction that will
see Nakumatt stores in Tanzania increase to four, in addition to its
Moshi outlet opened in 2011.
The acquisition has been valued at about Sh4 billion.
‘’We granted the approval to Nakumatt on Monday.
There were no much issues to deal with after Tanzania Union of
Industrial and Commercial Workers which had filed the case to block the
buyout by Nakumatt settled their grievances with their
employer,’’ said the Tanzanian Fair Competition Commission public
relations manager Frank Mdimi in a telephone interview.
Shoprite employees had moved to court two months
ago blocking the buyout by Nakumatt, over fears that they would lose
their terminal benefits with changes in ownership of the retail stores.
‘‘The approval has been granted with strict
conditions to Nakumatt on how they should operate in Tanzania and the
protocol to be observed when buying or importing their products,’’ added
Mr Mdimi.
Under the new guidelines, Nakumatt will be expected
to employ a certain percentage of the locals in their stores and sign a
pact with the government detailing how much they will be buying from
Tanzanian manufacturers and disclosing the bulk they will be buying from
Kenya.
Nakumatt Holdings’ head of strategy and operations Thiagarajan Ramamurthy last month told Business Daily that
the retail chain has already figured out how to address this concern,
which is said to have been the main reason behind Shoprite’s exit from
Tanzania.
“Our focus will be to support local manufactures by
buying most products from them,’’ said Mr Ramamurthy in an earlier
interview with the Business Daily.
Shoprite exited Tanzania after about 12 years in
the country after being accused of importing the bulk of its products
from its mother company in South Africa.
The Nakumatt Holdings managing director Atul Shah
Wednesday said the approval was a big win for the retailer which now
plans to start operations in the next three to four weeks to come.
‘‘We are ready for the Tanzanian market, we will start operations in less than a month or so,’’ said Mr Shah.
Nakumatt will rebrand the three Shoprite stores.
Mr Shah said former Shoprite employees who are willing to work for Nakumatt will be absorbed.
SHARE THIS STORY
‘‘We are not downsizing, but instead we are ready to work
with former Shoprite employees on new terms. We understand that they are
about 250 employees and this is a good number to start off with,’’ said
the Nakumatt MD.
Already, Nakumatt has contracted Hipora Business
Solutions East Africa Ltd, a Kenyan logistics firm specialising in
verification of supermarket supplies, to advise on efficiency and
recruit personnel for the three stores.
Wednesday, the firm said it been instructed by
Nakumatt to lay the ground for a possible opening of one of the Shoprite
branches by mid next month.
“We have been informed (by Nakumatt) that we should
be ready by mid next month to start operations at Shoprite Arusha
branch as they plan to open the rest,’’ said one of the senior
directors of Hipora Business Solutions East Africa on phone from
Tanzania.
The Shoprite Group is one of Africa’s largest
retailers. It operates 1,334 corporate and 406 franchise outlets in 17
countries across the continent and the Indian Ocean Islands.
Shoprite was previously the biggest retailer in
Tanzania ahead of rivals such as Shreejis Supermarket, Shoppers
Supermarket and the high-end Village Supermarkets.
Nakumatt takes over first Shoprite store
By SIMON CIURI
Posted Sunday, July 27 2014 at 21:01
Posted Sunday, July 27 2014 at 21:01
In Summary
The retailer said the opening of Nakumatt Pungu Road in
Dar es Salaam, which will also house its Tanzania Headquarters, and
Nakumatt Arusha will be done “in coming days.”
Regional Retailer Nakumatt Holdings has opened one of
its three new branches it recently acquired in Tanzania from South
African retail giant Shoprite. This is after the Kenyan supermarket
chain completed acquisition of three stores in a Sh3 billion buyout
financed by local lender KCB.
SHARE THIS STORY
“The opening of Nakumatt Mlimani is a long held
dream come true as we have been considering various avenues to establish
our presence in Dar es Salaam and other parts of Tanzania since 2010,”
said Nakumatt managing director Atul Shah in a statement yesterday.
The retailer said the opening of Nakumatt Pungu
Road in Dar es Salaam, which will also house its Tanzania Headquarters,
and Nakumatt Arusha will be done “in coming days.”
“This opening also sets the stage for our 50th
branch opening by mid-August which will be a key milestone as we’ll have
achieved our Nakumatt 2.0 Strategy goal a clear six months ahead of the
February 2015 target,” explained Mr Shah.
The three stores are located in Dar es Salaam and
Arusha. The Fair Competition Commission (FCC) of Tanzania cleared the
Nakumatt-Shoprite deal in May after Shoprite employees withdrew their
case from the High Court.
The workers had filled an injunction blocking
transfer of the business on the grounds that it may render them
jobless and result in loss of terminal benefits.
No comments :
Post a Comment