Cape Town – After 37 years as CEO of Shoprite [JSE:SHP], Whitey Basson is prepared to hang up his retailer boots and permit his successor to adapt to present circumstances.
Basson, who turns 71 in January, will venture down toward the end of December and be prevailing by Pieter Engelbrecht, the organization’s 47-year-old boss operations officer, Shoprite said in an announcement on Monday. Engelbrecht, who has been with the organization for over two decades, will assume control as CEO from January 1.
“I am tired – the business is now so large and there are so many issues that take up too much time,” Basson told reporters at the company’s annual shareholder meeting in Cape Town. “Pieter is a very driven guy. I’d say about 50% of the operating issues he’s already taken over. So it’s not a new job for him.”
Basson has led Shoprite since forming the company in 1979. He expanded the retailer from an eight-store chain to Africa’s industry leader with a market value of R115bn and more than 140 000 workers. To build on that, Engelbrecht will need to overcome weak domestic consumer confidence and is likely to take the company beyond Africa.
“Whitey has turned 70, so I think it was imminent,” Evan Walker, a money manager at 36One Asset Management, said by phone from Johannesburg. The incoming CEO “has been very instrumental in a lot of aspects of growth in that business, so I think he is a very highly regarded successor.”
Shoprite shares rose 4.2% to a two-month high in Johannesburg after the company also said sales gained 16% in the three months through September. Revenue at the South African stores increased 12% as promotions helped offset the impact on customers of high unemployment and inflation.
Basson began his career by working as an accountant in the early 1970s, then entered the retail industry as a financial manager of the Pep Stores chain. He formed Shoprite by acquiring a small Western Cape grocery business and began building the company through store openings and acquisitions.
Inspired by low-cost European discounters such as Aldi, Basson focused on the middle-to-lower income market, the biggest in South Africa, while acquiring and reviving larger, unprofitable supermarket chains such as Checkers and OK Bazaars. Shoprite opened its first store outside its home market in Zambia in 1995.
Basson said recently that the company will consider expanding outside Africa, following in the footsteps of fellow South African retailer Steinhoff, which has transferred its primary listing to Frankfurt and made bids for companies in France, the UK and the US. Shoprite has stores in 15 African countries. He will remain as a non-executive vice chairperson to ensure an orderly leadership transition, the company said.
“The company has become very large and is at a crossroads,” chairperson Christo Wiese, who is also South Africa’s richest man and Shoprite’s largest shareholder, told investors.
The progression comes just a month after Shoprite said it multiplied the CEO’s compensation to R100.1m in its last monetary year, because of a R50m reward for beating a benefit development target.
Right around 30% of votes at the AGM were thrown against the compensation approach, in accordance with the earlier year, when the Public Investment Corporation was among the individuals who didn’t bolster the CEO’s compensation bargain. The state-claimed PIC is Shoprite’s greatest financial specialist with a 9.8% stake, as indicated by information aggregated by Bloomberg.