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Shoprite Namibia employees cash in on N$8.9bn BEE scheme

May 19, 2022 0
Shoprite Namibia employees cash in on N$8.9bn BEE scheme

Shoprite Namibia employees are expected to cash in on the retailer's new N$8.9 billion black economic empowerment (BEE) deal.

According to the Shoprite group, 126 000 South African employees who will be direct beneficiaries of the deal and 16 000 non-South African employees including from Namibia will benefit from an initial distribution of N$77 million for the 6-month period to 2 January 2022.

“Notwithstanding the fact that the Transaction defines Beneficiaries of the Employee Trust as RSA Employees, Shoprite Holdings believes it is imperative to recognise the valued role all employees play in the Group’s success. As such, the Group’s Non-RSA. Employees will receive an equivalent payment to that of the RSA Employees, which will be paid as a cash bonus payment through payroll, subject to the same eligibility criteria and terms as applicable to the Beneficiaries of the Employee Trust,” the Group said in a SENS announcement.

According to terms of the deal, the Shoprite Group will issue 40 million shares, in its subsidiary, Shoprite Checkers, to its staff through a new black economic empowerment (BEE) trust, effectively increasing black ownership in the subsidiary to 19.2%.

“The transaction is intended to retain, motivate and incentivize the employees of the Shoprite Group to continue to contribute towards its success going forward. The transaction represents a material step that has been taken in strengthening the relationship between the Shoprite Group and its employees for the benefit of the Shoprite Group,” the company said.

Shoprite Checkers will provide a N$888 million contribution which will allow for the subscription of 10% of the shares to be held by the Shoprite Employee Trust, with the balance of shares funded on a notional basis by Shoprite Checkers.

“The Shoprite Group anticipates the impact of the transaction on the Shoprite Group’s headline earnings to be a reduction in the region of 2.7%. This is based on the initial distribution to be paid relative to the Shoprite Group’s headline earnings from continuing operations for the 6-month period to 2 January 2022. This transaction will not have an impact on the shares in issue in Shoprite Holdings.”

“This is based on the initial distribution to be paid relative to the Shoprite group’s headline earnings from continuing operations for the six months to January 2, 2022. This transaction will not have an impact on the shares in issue in Shoprite Holdings.”

Relations between Shoprite and its Namibian employees have not been rosy, with 2 040 of the about 4 600 employees having embarked on a strike after negotiations for wage increases had reached a deadlock.

Shoprite in Namibia operates over 20 stores.

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Last modified on Sunday, 22 May 2022 05:12
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