South African retail giant Massmart, parent company of Game Stores has announced plans to exit the Ugandan market.
The South African franchise made the revelation last Friday, during the group’s virtual financial results presentation.
Game stores joins its peer Shoprite Holdings SHPJ.J which confirmed last month that it was pulling out of the Ugandan market as Covid-19 impact continues to bite harder foreign owned companies in Uganda
Massmart Chief Executive, Mitchell Slape said the difficult business environment has pushed the supermarket chain to dispose of its under performing 14 stores outside South Africa.
“The performance and the complexity in running those businesses is something that frankly we needed to address. We’ve commenced a formal sales process, we’re currently in discussions with potential purchasers to take on those stores,” Slape said as quoted by Reuters.
“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.
With an aim to stabilize its business, Slape said the company opted to put up its five Game Stores in Nigeria, four in Ghana, three in Kenya, one in Uganda and one in Tanzania for sale to potential buyers.
The Johannesburg Security Exchange-listed company expects its move to result into an annual profit before interest and tax improvement of 750 million rand ($50.24 million).
Game is a promotionally driven discount retailer of predominantly general merchandise and non-perishable groceries for home, leisure and business use. Some Game Stores also stock a select range of fresh food, including fruit and vegetables, pre-packed meats and pre-baked goods.
Game, which opened in Uganda in 2004, operates in 12 African countries including: South Africa, Nigeria, Zambia, Ghana, Malawi, Mauritius, Mozambique, Namibia, Botswana, Uganda, Kenya and Tanzania.
In Uganda, Game Stores are located in Lugogo.