Standard Chartered invests US$50 million into Botswana FMCG company

Standard Chartered Private Equity (SCPE) has acquired 13% of Botswana-based consumer goods retailer Choppies Enterprises – through a Private Investment in Public Equity (PIPE) deal.

The deal value has not been disclosed but is estimated at about $50million – and is understood to be  Botswana’s largest private equity transaction, historically.

The deal closed at the end of 2013, and was sourced proprietorially – with Choppies being a client of Standard Chartered Bank. Choppies is listed on the Botswana Stock Exchange.

SCPE’s investment will fund the company’s growth plans, which include expanding its foot print across Southern Africa.  Part of the company’s plan is to grow its South African stores to about 80, from the current 23.

The company is working towards having about 40% of its revenues come from South Africa. Sales in South Africa are set to be boosted by a dedicated distribution centre, opened  in 2012.

Choppies has also recently expanded in Zimbabwe – acquiring a chain of 10 stores, and a distribution facility. In Botswana, the company is estimated to hold over 30% share of the retail market in the country’s Fast-Moving Consumer Goods (FMCG) space.

Headquartered in Gaborone, Choppies retails FMCG products through more than 100 stores across Botswana, Zimbabwe and South Africa. The company was founded in 1986 and employs more than 10,000 people

Choppies reported profits before tax of approximately $23million (P198million) for the full year up to June 2013, a 27% year-on-year growth. Its revenue for 2013 stood at about $471million, growing about 22% from 2012.