ANA
Premium Journalist
1 minute read
20 Feb 2017
12:30 pm

Steinhoff-Shoprite merger talks collapse

ANA

This comes after Steinhoff in December proposed a deal in which it would sell its mainly South African assets to Shoprite.

A file photo taken on March 20, 2014 shows shoppers at the new South African retail giant Shoprite outlet in Kano, northern Nigeria. Nigeria has overtaken South Africa as the continent's largest economy with a GDP of $453 billion in 2012, officials said on April 6, 2014. The figure is based on a long-overdue rebasing of Nigeria's gross domestic product to reflect changes in the structure of production and consumption, and compares with South Africa's 2012 result of $384 billion. AFP PHOTO / AMINU ABUBAKAR

South African retail group Steinhoff International on Monday terminated negotiations to merge with supermarket giant Shoprite after an agreement could not be reached on the exchange ratio that would apply to the share exchange.

This comes after Steinhoff in December proposed a deal in which it would sell its Africa assets, mainly South African, to Shoprite in exchange for shares in a bid to create Africa’s biggest retailer, worth an estimated R180 billion.

This meant there was a possible exchange by the largest shareholders of the companies, the Public Investment Corporation (PIC) and Titan Premier Investments, of their Shoprite shares for Steinhoff shares at a “to be agreed” ratio, the share exchange.

Titan is the investment company in which retail mogul and Steinhoff chairman Christo Wiese holds shares in the grocery and furniture groups.

“Shareholders of the companies are hereby informed that the companies have decided to terminate their negotiations related to the proposed transaction as the PIC, Titan and Steinhoff could not reach agreement on the exchange ratio that would apply to the share exchange,” Steinhoff said.

“The proposed transaction was investigated and analysed by the respective management teams of Steinhoff and Shoprite, and although the proposed transaction presents exciting opportunities for the companies and their respective management teams, the fact that the relevant parties could not reach an agreement in respect of the share exchange resulted in the negotiations being terminated.”