Massmart 'may ditch Zimbabwe'

2010-10-19 17:17

Johannesburg - Massmart, the South African retailer Walmart is in talks to acquire, said it could pull out of Zimbabwe if that country goes ahead with current plans to increase black ownership of foreign firms.

"Should the indigenisation act be implemented in its current format, Massmart Holdings [JSE:MSM] will have to reconsider its position in Zimbabwe," Grant Pattison, Massmart's chief executive officer, told Reuters.

Zimbabwe's government published regulations earlier this year that would force foreign-owned firms to sell 51% of their shares to to black Zimbabweans, a move that spooked investors.

Massmart, South Africa's third-largest retailer by value, runs two of its Makro discount stores in Zimbabwe, but does not consolidate them into its financial results.

Wal-Mart is in exclusive talks to buy Massmart, a $4 billion deal that would give the US retailer a big presence in fast-growing Africa and boost its emerging markets strategy.