According to reports South African retailers Steinhoff and supermarket chain Shoprite have withdrawn a $14 billion agreement to create Africa’s largest shop network.
The proposed deal would have been the latest move in line with expansion by Steinhoff, which also take over the UK’s Poundland discount chain last year.
In the recent days deal seemed to have collapsed after Shoprite shareholders criticized that they were not getting a right deal.
According to a trader at Global trader, Mr. Paul Chakaduka, said the breakdown of the deal would delight most of the Steinhoff shareholders.
“For Shoprite there has been this major overhang around this acquisition for a very long time and I think it will free up any uncertainties,” he said.
Presently Steinhoff’s brands comprise likes of Hardware Warehouse and clothing store Pep.
More than its South African operations, Shoprite also own stores in Angola and Nigeria. Steinhoff possesses 40 retail brands in 30 different countries, including Bensons for Beds and Harveys in the UK.
Reports said one of the major sponsors of the agreement was Christo Weise, the South African retail billionaire ranked by Forbes as the second-richest man in Africa. He reportedly owns 23% shares of Steinhoff and 16% of Shoprite.
Following the report, Steinhoff shares surged 7% in Johannesburg, while Shoprite rose 6%.