Portugal’s Sonae expands ties with Mo Ibrahim’s Satya group, but Angola stays out

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Portugal’s Sonae expands ties with Mo Ibrahim’s Satya group, but Angola stays out

6:45 CAT | 20 Mar 2017

Publico (File photo) / A supermarket in Maputo bought by Sonae

Sonae executive president Paulo Azevedo yesterday admitted to an expansion of his partnership with Satya, which the group has joined to enter the food retail market in Mozambique, but said that Angola would not form part of the agreement.

“We are developing an important partnership, but it is still only two stores – it is a small investment,” Azevedo said during the presentation of Sonae’s 2016 accounts yesterday in Maia, Portugal.

While referring to developments later in 2017, the Sonae leader revealed that the partners were “looking for new locations to grow” in Africa and, without specifying any new markets, made it clear that Angola – where its first attempt at entry into the retail food sector in partnership with Angolan businesswoman Isabel dos Santos, was unsuccessful – would not be included.

“I still do not know what the scope [of an eventual expansion of the partnership with the Satya group by millionaire Mohamed Ibrahim, announced in September 2016] is, but Angola is excluded,” he said.

Asked by journalists about the recent Portuguese push by the Spaniards of Mercadona, who before 2019 intend opening four supermarkets in the Greater Porto region, Azevedo joked that “Portugal is a real party. We have all the big players – French, German. There’s no lack of activity.”

Along the same lines, Sonae CEO Angelo Paupério added that “it is not yet another” operator to join the “ten giants” already established in Portugal, and that the Sonae group would not “worry” or be prevented from growing. “It’s one more, and a good one,” he said.

Sonae is not to looking for a strategy in electronics – where it owns the Worten chain – similar to that employed in its Sport Zone participation with British multinational JD Sports and JD Sprinter in the Iberian peninsula.

“Worten has already achieved profitability in 2016 [in the Iberian operation]. We do not think there is a value-added solution like that in sport, but it is not impossible. We are more and more comfortable working with partners, but it is not on our horizon,” Azevedo said.

In the area of telecommunications, where Sonae operates with NOS, Paupério said that the content acquisition process “is more or less stable”, and although there may be “movements by operators that raise other fronts”, the position of the group is that “creating disruptions ends up leading to the overall loss of value in the industry without significant competitive impacts.”

Regarding Sonae’s 2016 results, both Sonae’s executives said they were “very satisfied”, with a 7.2 percent increase in turnover (to EUR 5,376 million) to mean that the group “sold a more million euros per day” than in 2015, and earnings before taxes, interest, depreciation and amortization) exceeded EUR 1 billion “for the first time”.

“And this in a year when we have invested a lot – EUR 437 million in the consolidated universe and EUR 890 million in the aggregate universe – and reduced debt,” Paupério added, noting that currently “two-thirds of [Sonae’s] assets are financed by its own capital and only one third with loans”, precisely the reverse of what was the case in 2008.

Source: Lusa