Kenyan retail giant, Nakumatt Holdings has started the process of shutting down stores it recently acquired from Shoprite in Tanzania as it intends to renovate and rebrand before full operations begins in July.
“Nakumatt has sealed an assets buyout agreement with Shoprite,” Atul Shah, MD of Nakumatt said in a statement on Friday.
Shah added that the firm was embarking on a clearance sale of current stock as it plans to rebrand the three stores ahead of its reopening.
The retailer’s head of strategy and operations, Thiagarajan Ramamurthy stated that the sale is targeted at creating a sense of change to consumers and making them know that a new brand is now in charge of the outlets.
Nakumatt, East Africa’s largest retail outlet, completed the acquisition of three stores from Shoprite last month, after successfully overturning a ban by a Tanzanian court, blocking its bid to acquire the three outlets. The deal was valued at Sh4 billion ($45.5 million).
The ban came after the Tanzania Union of Industrial and Commercial Workers (Tuico) successfully obtained an injunction blocking the acquisition, but the Fair Competition Commission (FCC), the East African country’s competition watchdog last month, finally approved Nakumatt’s takeover of three Shoprite stores located in Dar es Salaam and Arusha.
Shoprite decided to exit the Tanzanian market after the government warned the South African company against flooding its market with South African made consumables, a development Nakumatt exploited to boost its retail network in East Africa, already the largest.
The retail firm has over 45 stores spanned across Kenya, Uganda, Tanzania and Rwanda, employing 4000 people.
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