Shoprite Streamlines While Pepkor Expands: R3 Billion Furniture Deal Gets Green Light

Retail giant Shoprite is taking a bold step toward focusing on its core strengths—grocery and speciality retail—by selling its furniture business to Pepkor for approximately R3 billion. The Competition Commission has recommended the deal’s approval, albeit with some public interest conditions, moving it closer to final clearance by the Competition Tribunal.

The deal, first announced in September 2024, includes more than 400 stores across South Africa, Botswana, Lesotho, Namibia, Eswatini, and Zambia. This acquisition will significantly expand Pepkor’s presence in the homeware, furniture, and appliance market—growing its total store base by 25% to roughly 1,300 outlets.

What the Deal Covers

The transaction includes the OK Furniture and House & Home retail brands, inventory, fixed assets, the Shoprite Furniture credit loan book, and related insurance operations. The deal combines the furniture segments of Shoprite Checkers and OK Bazaars Venda under Pepkor’s expanding retail empire.

Shoprite Furniture, known for offering homeware, appliances, insurance, and credit services to a broad income market, has long served customers across several African countries. The Competition Commission found no substantial threat to competition from the merger. However, in the interest of public welfare, the approval is conditional on no retrenchments as a result of the deal and a commitment to maintain or grow procurement from local furniture suppliers.

Why Pepkor Wants Shoprite’s Furniture Business

Pepkor, already Africa’s largest clothing retailer, views the acquisition as a strategic move to strengthen its Pepkor Lifestyle division (formerly the JD Group), which operates over 900 stores across Southern Africa. The addition of Shoprite Furniture will enhance logistics, supply chain efficiency, and financial services integration across its network.

“The transaction allows Pepkor to expand its value proposition through a complementary product mix in furniture, bedding, appliances, and consumer electronics,” the company said. It also unlocks new opportunities in underrepresented regions, deepening its reach across the continent.

Shoprite Refocuses Its Growth Strategy

While divesting from furniture retail, Shoprite is doubling down on its grocery and specialist store strategy. One standout performer is Petshop Science, its rapidly growing pet retail brand. The group recently revealed a 56.9% increase in sales for Petshop Science during the six months ending December 2024, with 42 new store openings during that period—bringing its total to 135 stores nationwide.

“South Africa has over 22 million pets, and the market is spending upwards of R8 billion annually,” said Willem Hunlun, Shoprite’s Chief Operating Officer. “We saw a gap to democratise pet care by offering premium food and vet-approved essentials at supermarket prices.”

The Shoprite-Pepkor furniture deal marks a significant reshuffling in South Africa’s retail landscape. For Shoprite, it’s about sharpening focus on high-growth areas like grocery and pet care. For Pepkor, it’s a strategic expansion that brings scale, reach, and synergies. With regulatory approval progressing, the transaction could reshape both companies’ trajectories—and redefine what value retail looks like in Southern Africa.

{Source: BusinessTech}

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