A South African supermarket that has been operating Game Stores in Kenya has announced its intended exit in the local market.
Supermarket that tried to buy Naivas announces plans to exit Kenya
The international supermarket is selling 14 stores after making a loss of Sh2 billion.
Massmart which is the parent company made the announcement recently in August, adding that it was looking to sell its investments in Kenya, Uganda and Tanzania.
In Kenya, Game Stores are located at Garden City Mall along Thika Superhighway, The Waterfront Karen and Mega City Mall in Kisumu.
“We have reached the conclusion that the performance and complexity in running the 14 stores in five markets in the East and West Africa is something frankly that we needed to address,” Massmart CEO Mitchell Slape said.
He added that in the last year, Game Stores across the continent suffered a Sh2.6 billion loss. However, the CEO said the sale of the 14 stores is expected to result in an annual profit before interest and tax improvement of Sh5.6 billion.
"But that is not enough. Achieving break-even performance isn't going to be sufficient for us to be satisfied, we've got to really get Game back to a healthy level of profitability and performance," he explained.
The company opened its first premises in Kenya in 2015 at Garden City Mall but over the years, has struggled to crack the industry which is now dominated by local supermarkets.
The decision to open stores in Kenya came after its bid to acquire a majority stake in Naivas Supermarket failed.
The firm is yet to reveal any potential buyers or details about the exit plan but vowed to keep the interests of its staff first.
Massmart is majority-owned by American super chain Walmart, and is one of the South African companies which have not found luck in the Kenyan market.
Others include Shoprite, Supreme Furniture, Media24, Nu Metro and Nandos.
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