Popular South African food producer, Tiger Brands Ltd. is set to sell its 49% minority shareholding in UAC Foods Ltd. to parent UAC of Nigeria Plc.
According to bloomberg.com, the purchase is expected to be completed in September, UAC of Nigeria said in a filing published on the website of the Nigerian Exchange Group. UAC of Nigeria currently owns 51% of UAC Food’s shares.
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Tiger Brands acquired a minority state in UAC Foods in 2011, following a joint venture agreement with the Nigerian firm to manufacture and distribute some sausage, ice cream and water brands. It is exiting Nigeria about two months after another South African firm, Shoprite Holdings Ltd., sold its operations in the West African country to local investors.
Also, Tiger Brands in 2015 sold its shareholding in Dangote Flour to Nigerian parent Dangote Industries Ltd., three years after buying it.
Similarly, South African retail giant, Massmart has announced plans to join its competitor, Shoprite to sell assets in West Africa and East Africa, as it concludes to sell 14 stores in Nigeria, Ghana, Uganda, Kenya and Tanzania.
According to nairametrics.com, this was disclosed by its Chief Executive Officer, Mitch Slape.
Massmart revealed reasons including currency volatility regarding its Nigerian business and falling consumer demand.
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“But that is not enough. Achieving break-even performance isn’t going to be sufficient for us to be satisfied, we’ve got to really get Game back to a healthy level of profitability and performance,” he added.
This comes after the company, majority-owned by American retail giant, Walmart, reported a half-year loss.
Massmart says the move to withdraw from Nigerian and East African markets will result in an annual profit before interest and tax improvement of 750 million rand ($50.24 million).
In the same vein, South Africa retail giant, Shoprite Holdings Ltd. had earlier sold its Nigerian division to a local property group.
The deal for Persianas Group Ltd. to buy the unit is subject to regulatory approval, Cape Town-based Shoprite said in a statement.
While the asset has been valued by the seller at 30 billion naira ($73 million), it’s not clear how much Persianas agreed to pay.
