Actis deepens food retail growth in SA with US$54m investment
The growth of food retail business in South Africa has received a major boost as Actis, a leading emerging market investor with strong footprint in commercial real estate development in Sub-Saharan Africa, has made a substantial investment of R760 million (US$54 million) in Food Lover’s Market.
Growing from its origins as a single Fruit & Veg City store 22 years ago, Food Lover’s Market has become South Africa’s largest specialist fresh produce retailer with 120 stores in South Africa and another 19 stores in 10 Sub-Saharan African countries and Mauritius. It prides itself on quality fresh produce, theatre of food experience with a distinctive market feel, and consistent value offerings for consumers.
The company is one of the last few independent food retailers of scale on the African continent. It has a strong brand and a growing footprint across Africa. With over 120 Food Lover’s Market stores and a presence in 11 countries, in recent years it has added categories such as bakery, grocery, butchery and deli foods to complement its market leading position in fresh produce.
Actis, which has a growing portfolio of investments across Asia, Africa and Latin America and US$7.6 billion funds under management, is acquiring a substantial minority stake in this business and is backing founders, Brian and Mike Coppin, together with the existing management team, who have created a remarkable success story based on a market leadership position in fresh produce retail.
This latest transaction is Actis’s fourth investment in South Africa in eighteen months, following its recent investments in Coricraft, one of South Africa’s leading home furnishings retailers, Tekkie Town, the country’s leading independent sports shoe retailer, and CSH a credit bureau and information services business.
It follows Actis recent US$62m investment in Sigma Pensions, a leading Pension Fund Administrator (PFA) in Nigeria and the firms’ recent sale of Ikeja City Mall, Lagos’ largest mall.
Actis was able to draw on its retail experience developing malls including Ikeja City Mall, Jabi Lake Mall— Abuja’s one-stop leisure, restaurant and retail destination; The Palms, the first ever international-standard diversified retail mall in Nigeria. It is also building Heritage Place—a world-class office development in Lagos’s commercial and retail area. Actis’ investment in Food Lover’s Market includes funding into the business to continue the company’s growth in South Africa and other countries within Sub-Saharan Africa. Food retail is the largest retail sub sector in the South African economy, valued at US$35 billion (R471 billion) having grown historically by 9.5 percent per annum.
Actis has a strong track record of backing high-quality food retail businesses in other emerging markets including supermarket chain, Companhia Sulamericana de Distribuição in Brazil and Nigiris, one of India’s best known food retail brands.
David Cooke, Director at Actis, notes that “Brian and his team have carved a niche in the South African food retail landscape, offering a distinguished value proposition to aspirational consumers looking for high quality products at real value; we look forward to working together to continue the Group’s growth story and expanding further within Africa.