Kenya's Uchumi to open 13 supermarkets across East Africa
Reuters - May 15th 2013, 10:35
Kenya's Uchumi Supermarkets will open 13 new stores over the next year as East Africa's sole listed retailer prepares for a cash call and a cross listing of its shares, its chief executive said on Tuesday.
Uchumi, Kenya's second-largest retail chain by sales, has 25 stores across east Africa, where fast-expanding economies are creating a growing middle class. It plans to list its shares on the Tanzanian, Ugandan and Rwandan bourses and then offer investors 100 million shares in a rights issue.
The company, which already operates some stores in neighbouring Uganda and Tanzania, said it planned to use the cash from the rights issue to pay for expansion in its existing markets and open its first supermarkets in Rwanda and newly-independent South Sudan.
"In the next one year or so, we plan to open around 13 retail branches across East Africa in a bid to competitively and strategically position our business, and these will also require substantial capital spend," Uchumi Chief Executive Jonathan Ciano said in a statement.
The funds will also be used to refurbish some of its stores in Kenya, Ciano told a news conference at one of the chain's stores in the capital Nairobi.
The retailer picked Faida Investment Bank as the lead transaction advisor for the rights issue and cross-listing of shares in the neighbouring countries.
Kenya is part of an East African Community common market with Rwanda, Burundi, Tanzania and Uganda. Other Kenyan firms such as Kenya Airways have also cross-listed their shares in the regional bourses.
Ciano said the cross-listings would take place before the rights issue and required the approval of financial market regulators in those countries.
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