Pick n Pay Stores announced plans to enter Nigeria through a partnership with a local company as the South African retailer extends its reach on the continent following a 26 percent rise in full-year earnings.
Pick n Pay already operates in Botswana, Zimbabwe and Namibia and plans to open new stores in Ghana next year.
Like many other South African companies it wants to expand further across the continent amid sluggish economic growth at home.
The retailer, which reported a 26% jump in annual earnings on Tuesday, said it would take a 51% stake in a Nigerian joint venture with conglomerate A.G. Leventis, which runs a food business.
The supermarket and clothing chain has agreed to partner with Lagos-based AG Leventis & Co to enter Africa’s largest economy, it said in a statement on Tuesday. Leventis has experience dealing with on-the-ground challenges in Nigeria such as transportation, getting products into stores, and property, Pick n Pay said.
“We need to further extend our Africa business,” CEO Richard Brasher said in a presentation in Cape Town. Pick n Pay will hold 51 percent of the operation in Nigeria, which will tap the experience of its local partner, he said.