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Africa’s largest supermarket chain, Shoprite Holdings Limited, has disclosed that its upmarket grocery retailer has entered into a JV agreement with the leading logistics company, RTT Group.
The joint venture agreement between Checkers and RTT Group aligns with an earlier statement by Shoprite Holdings CEO Pieter Engelbrecht that the retailer will continue to create value for shareholders according to its commitment to bolster brand presence and deliver on its low-price promise.
According to a press release issued by Shoprite yesterday, Dec. 13, the joint venture is part of a broader move by the company to strengthen its e-commerce delivery capabilities in the retail segment.
The company added that the transaction piggybacks on the rapid growth of Shoprite’s pioneering on-demand grocery solution, Checkers Sixty60, in which RTT On-Demand, a division of RTT Group, has played a pivotal role in last-mile logistics.
Engelbrecht explained that the combined capability with RTT is a critical competitive advantage that is key to Checkers Sixty60’s growth.
“This RTT On-Demand joint venture will allow the group the opportunity to continue enhancing our order fulfilment and last-mile delivery capabilities whilst giving us the opportunity to grow our precision retailing efforts for our customers,” he said.
As a result of the agreement between RTT Group and the leading retailer, RTT’s on-demand business will be transferred into a new company in which Checkers, an operating subsidiary of Shoprite, will hold 50 percent of the issued ordinary shares.
The 50-percent stake that will be offered to Checkers for an undisclosed sum will be subject to the fulfilment of both commercial and regulatory conditions.
The deal will also include RTT’s on-demand technology platform, management and operations teams, as Checkers Sixty60 continues to leverage the platform as its delivery partner.
As of press time, Dec. 14, shares in Shoprite on the Johannesburg Stock Exchange were trading at R208 ($12.94), giving the retailer a R122.5-billion ($7.64 billion) valuation.
The agreement with RTT Group comes three months after Shoprite unveiled plans to integrate the subsidiaries of the Walmart-owned Massmart into its operations.
