By Times News
Copyright times
By Kingsley Jassi:
South Africa’s biggest grocery retailer, Shoprite Holdings, has moved closer to exiting the Malawi market after decades of operations.
The company saw its way out being endorsed by the Competition and Fair Trading Commission (CFTC), which approved the acquisition of the company’s local assets by a local company, Karson Investment.
“The Competition and Fair Trading Commission (the Commission) has authorised the proposed acquisition of business assets of Shoprite Trading Limited by Karson Investment Trust, following a thorough assessment conducted under the Competition and Fair Trading Act,” reads a statement signed by CFTC Chief Executive Officer Lloyds Nkhoma.
The statement further said the commission evaluated the transaction’s impact on two relevant markets that include the retail trading of groceries and other merchandise, and the leasing of retail property.
It says the assessment concluded that the transaction would not substantially lessen competition in either market, nor will it result in the creation of a dominant player.
However, the commission noted potential public interest concerns in the retail trading of groceries and other merchandise markets, including the risk of employment loss for Shoprite employees and potential impacts on the shopping experience for customers.
Therefore, the commission ensured safeguards that compel Karson to maintain employment and the standards the new retailer will offer to customers.
In early August, the company announced it was selling its operations in Ghana and Malawi, marking another step towards consolidation of its activities in the Africa region to focus on its home market.
The retailer had expanded widely in Africa, surpassing its rivals such as Pick n Pay and Massmart to command the continent’s retail market in 15 countries.
The exit of Shoprite will follow another major exit by Peoples, which was liquidated following a flopped sale to another local company that struggled to settle some financial obligations the retailer left.
