Wal-Mart Stores Inc announced that the company has completed its investment for a 51% stake in South African-based Massmart Holdings Limited for ZAR148.00 per Massmart ordinary share.
Doug McMillon, president and CEO of Walmart International, said, "With the closing of our investment in Massmart, we are very excited about our entry into South Africa as well as the broader African continent. As we do in all of our other markets, we will work to serve underserved customers, to help people save money to live better. Just as important, we will grow in this part of the world, and as we do, we expect to create many jobs and support local suppliers. We have a global track record of working directly with small farmers, boosting their income and helping them become more sustainable, and we look forward to bringing those practices to South Africa."
Massmart will continue to trade on the JSE Limited to provide Massmart shareholders with the ability to participate in the growth opportunity of the combined entity.
In terms of the transaction agreement, Walmart is entitled to nominate the chairman and three non-executive directors to the Massmart Board. Walmart has asked current Massmart chairman Mark Lamberti to remain as chairman, while the Board will be further strengthened by Walmart executives Doug McMillon, Jeff Davis, Wal-Mart Stores, Inc. senior vice president, Finance & Treasury, and JP Suarez, senior vice president, Walmart International Business Development.
McMillon concluded, "We're committed to partnering with government and key stakeholders, and we will encourage others to invest in Africa's vibrant economy, because the more we learn about South Africa and the surrounding countries, the more we're convinced this is an important region with attractive growth characteristics. It's a combination that fits with our strategy to enter high growth markets where we can apply our global expertise and generate strong returns for shareholders."
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