South Africa's Steinhoff and grocery retailer Shoprite called off a deal on Monday to create an African shopping giant, preventing leading investor Christo Wiese from bringing more of his retail assets under one roof. Billionaire Wiese, a shareholder in both companies and the architect of the deal, and other investors including state-owned pension fund the Public Investment Corporation (PIC) could not agree on the value of a share exchange.
The deal's collapse will test Wiese's determination to place more and more of his assets in one basket. At least three of Shoprite's minority shareholders told Reuters last week the commercial and strategic logic did not stand up to scrutiny.
Bankers estimated the combination would have a value of more than 180 billion rand ($14 billion). Wiese told Reuters in a telephone interview that he still saw opportunities for Shoprite, an $8 billion grocery retailer, and Steinhoff, the owner of Conforama in France and Poundland in the UK, to work together.