13 December 2011
South Africa’s Pick’n Pay Retailers will invest US$13-million in Zimbabwe’s Thomas Meikles (TM) stores, raising its stake in the supermarket chain from 25 to 49 percent, TM announced on Friday.
“This investment by Pick ‘n Pay has received the approvals from the Reserve Banks of Zimbabwe and South Africa,” as well as other relevant authorities, TM said in a statement to shareholders.
TM said the investment was in line with new regulations imposed by President Robert Mugabe, limiting foreigners’ stakes in Zimbabwean firms to 49.0-percent.
“TM will utilise this $13-million investment to update and refurbish existing stores, and the public will notice changes in TM’s supermarkets in the coming months,” it said. “In time there will be the establishment of a number of franchise operations which will create employment opportunities.”
The company said the TM brand will be retained, “though certain strategic stores will be re-branded Pick ‘n Pay.”
TM Supermarkets is part of the business empire established in 1910 by founder Thomas Meikles. The company has interests in hotels, property, ranching and investment.
The investment marks a vote of confidence in Zimbabwe by a key South African firm, as other companies in the continent’s economic powerhouse have searched for opportunities across the border.
Zimbabwe’s economy has stabilised over the last two years after Mugabe and Prime Minister Morgan Tsvangirai formed a coalition government, discarding the local dollar left worthless by inflation which ran into multiples of billions.
The country is now using the US dollar and regional currencies such as the South African rand.