Walmart to Buy 47% of Massmart It Doesn’t Already Own

Walmart is proposing to spend 6.4 billion South African rands ($378.6 million) to buy the 47% of South African retailer Massmart it doesn’t already own and take it private, said Massmart Monday. The transaction, if finalized, “represents a positive vote of confidence in South Africa by the world’s leading retailer,” it said. Walmart has a 12-year “operational history” in South Africa, and its 100% ownership in Massmart “could stimulate investor interest and confidence in the face of depressed local and international investor sentiment, thereby assisting in the economic recovery of the country,” it said. The deal would provide Massmart “with needed access to ongoing financial and operational support from Walmart” to sustain Massmart’s turnaround, “which has been impeded by external factors,” including COVID-19 “trading restrictions” and the “challenging economic environment,” said Massmart. “These factors have exacerbated liquidity risk at Massmart, which Walmart’s financial support has helped to mitigate.” Walmart loaned Massmart 4 billion rands ($237.2 million) in April 2020 at the height of the COVID-19 lockdowns, half of which was converted to Walmart’s majority equity interest in Massmart in December 2021. The company does business under the banner, “Massmart powered by Walmart.”