Choppies to grow after listing

CHOPPIES, a Botswanan supermarket chain, will retain Standard Chartered as an investor after its proposed R1.37 billion secondary share sale in Johannesburg later this month.

The London-based bank was not selling stock and would own about 12 percent of the grocer, while management would hold 35 percent, Choppies chief executive Ramachandran Ottapathu said yesterday. Standard Chartered might even increase its position, Ottapathu said.

Choppies, which was founded in 1986 and has operations in Zimbabwe and South Africa as well as its home market, plans to expand in more African countries to take advantage of rising household incomes, economic growth and a switch by shoppers to stores from outdoor markets. It wants to add 75 new stores by the end of December in countries including Kenya, Tanzania and Zambia, which would take its total to about 200.

The food retailer was issuing 117 million new shares for about R574 million, bringing the total for sale to 277 million shares, it said in a statement. That means about 52 percent of stock will be available for public trading. Based on a current share price of 4.09 pula (R5), the total raised would be about R1.37bn.

Choppies, which locates its stores near taxi ranks and bus routes and is not in large malls, had not experienced “signifi cant pressure” on sales in South Africa, Ottapathu said. “We see growth opportunities in the current markets in which we operate and the retail penetration of the markets we are going into is low,” he said.