Shoprite cuts influence of President Wiese


South African shopocer Shoprite is to buy back deferred shares held by its chairman Christo Wiese to simplify its voting structure but substantially restricting Wiese's influence on the company he helped turn into a African power.

In addition to the common shares, Shoprite's capital structure includes deferred shares that hold approximately 32.3% of the voting rights in Shoprite. Deferred shares are held by Weise's investment vehicle, Thibault Square Financial Services Proprietary.

Under the agreement, Titan – another of Wiese's entities – will receive 20 million new common shares of Shoprite in exchange for deferred shares that Shoprite will buy for R $ 16,000 (US $ 18,836.41) and will cancel, the retailer said in a statement .

The proposed agreement provides that Wiese's voting stake will be reduced to 17.8% from 42.3%, while its direct stake will increase to 17.8% from 14.8%, Shoprite said.

After the issuance of the new shares, total minority shareholders' votes will increase from almost 60% to over 80%, while their share will be diluted by 3.5%, he added.

Wiese has been instrumental in Shoprite's transformation of only six outlets South Africa in the 1970s to 2,800 stores throughout Africa, beating rivals like Walmart Inc South African Massmart drive.

Shoprite, which also sells furniture and medicines, said the deal should result in a potential reduction in profits and profits of R3.3 billion, based on a 30-day weighted average price of R165. 35 per share on April 17.


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