The retailer had acquired majority control of Massmart through a 51% stake in 2010.
Over the past decade, Walmart has provided increasing levels of support across Massmart’s businesses as they underperformed due to various reasons including consumers holding back from purchasing electronics and home goods.
In 2019, Massmart’s management launched a turnaround plan that involved selling off non-core assets, removing fresh food from its Game stores and cutting costs across the group.
However, challenges such as the Covid-19 pandemic and the civil unrest in 2021 have resulted in loss of operations and disruptions to the supply chain on certain key inventory lines, flooding as well as weak consumer demand for general merchandise, Massmart said.
“The potential offer, if finalised, will provide Massmart with needed access to ongoing financial and operational support from Walmart to sustain the group’s turnaround,” Massmart said.
If the offer is made and implemented, it would result in the delisting of Massmart, Massmart said.
The retailer has 403 retail and wholesale stores in 13 African countries.
It said the headline loss for continuing operations in the 26 weeks ended June 26 widened to 903.5 million rand ($53.18m), from a loss of 358.5 million rand the same time last year.
