Chop­pies to en­ter Nairobi in De­cem­ber

Group CEO said the move is part of the re­tailer’s plan to have at least 30 stores coun­try­wide in the next two years

The Star (Kenya) - - News Business - WEITERE MWITA @MwitaMartin

Botswana’s Chop­pies Su­per­mar­kets will take over three Uk­wala su­per­mar­ket stores in Nairobi in the next 39 days, the re­tailer has said, as it seeks to ce­ment its pres­ence in the coun­try.

Group CEO Ra­machan­dran Ot­ta­p­athu said the move is part of the re­tailer’s plan to have at least 30 stores coun­try­wide in the next two years, mainly in large pop­u­lous ci­ties of Nairobi and Mom­basa.

“We will take over Nairobi shops and rein­vest them. We are also look­ing for space in Mom­basa,” Ot­ta­p­athu told the Star in a tele­phone in­ter­view.

He said the re­tailer will also start op­er­at­ing in El­doret next year af­ter suc­cess­fully tak­ing over nine Uk­wala stores in Kisumu, Bun­goma, Nakuru and Kisii.

Chop­pies an­nounced its takeover of Uk­wala out­lets on May 30, af­ter a year­long quest.

Its first an­nounce­ment to en­ter Kenya in May last year was de­layed by a Kenya Rev­enue Au­thor­ity claim, which was de­mand­ing Sh946 mil­lion in taxes and in­ter­est from Uk­wala.

The tax­man went to court to seek an in­junc­tion on the ac­qui­si­tion, de­lay­ing the deal.

KRA and Uk­wala how­ever agreed to set­tle the dis­pute out of court.

In a Gazette no­tice dated Oc­to­ber 30, 2015, the two stores said they had struck a deal to fully trans­fer op­er­a­tions at out­lets in Nairobi, Kisumu and Bun­goma sub­ject to “cer­tain con­di­tions prece­dent”.

They also agreed that Chop­pies would not be re­spon­si­ble for debts and other li­a­bil­i­ties in­curred by Uk­wala at the seven branches it had bought, in­clud­ing three in Nairobi.

The Nairobi branches Chop­pies is ex­pected to take over next month in­clude Tom Mboya Street, Mfangano and Haile Se­lassie.

Among branches it has al­ready ac­quired are Ken­shop, Foa­mat, Swan and Dubai in Kisumu, and the Bungo- ma branch.

“We are keen to have out­lets across the coun­try. This in­cludes com­ing up with new stores,” Ot­ta­p­athu said.

Chop­pies en­ter­prises Kenya, the Botswana re­tailer’s sub­sidiary con­tin­ues trad­ing as Uk­wala.

Chop­pies also op­er­ates in South Africa with 20 stores. It has stores in Zim­babwe, Zam­bia and Namibia.

The re­tail­ers sealed a deal to ac­quire Uk­wala’s business for $10 mil­lion (Sh1.02 bil­lion), a deal an­nounced on May 29, 2015.

Uk­wala had ini­tially reached a deal with Tuskys, Kenya’s sec­ond largest re­tailer by mar­ket share, to sell its six out­lets in Nairobi, in Oc­to­berc2013.

The Com­pe­ti­tion Au­thor­ity of Kenya how­ever de­clined to ap­prove the deal for fair com­pe­ti­tion rea­sons, only sanc­tion­ing the ac­qui­si­tion of the Jo­goo Road branch on Septem­ber 19, 2014.

The en­try of Chop­pies into the cap­i­tal comes amid in­creased com­pe­ti­tion from multi-na­tion­als and lo­cal owned re­tail stores set­ting up shop in Nairobi.

/ FILE

A branch of Uk­wala Su­per­mar­ket in Nairobi

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