Carrefour launches major expansion plan in Egypt

Apr 25, 2019

Carrefour MAF
Majid Al Futtaim, Carrefour’s Middle East and East African partner, has launched a major expansion plan in Egypt. It will invest EGP700m ($40.75m) to have opened 20 new stores in 2019. By end 2019 it will have a 60 store network and likely be the largest supermarket chain in Egypt.

Majid Al Futtaim (MAF) is already a major operator in Egypt. It has 35m customers and is the second largest grocery retail chain in the country with 13 hypermarkets and 31 supermarkets (four of which opened in Q1 2019). It also operates shopping malls under the Mall of Egypt and City Centre brands in Egypt, with three malls and a fourth due to open shortly. Egypt accounts for 7% of the company’s revenues and is on track to become its second largest market after the UAE.

The backdrop to this decision is MAF’s view of the recovery in the Egyptian economy, following what it calls “the bold structural reforms since 2016.” In the financial year ended 31st December 2018, revenues in Egypt rose year on year by 21.8% in Egypt, up from AED1,985m ($536m) to AED2,417m ($653m). The opening of MAF’s new 103,000m² City Centre Almaza mall in Cairo and these new stores will take MAF past the $1bn revenue mark in Egypt.

The expansion has a strong political component, of course: a show of confidence by the UAE in Abdel Fattah el-Sisi’s autocratic government. The press release outlining the new store plans noted that Majid Al Futtaim Retail has affirmed its commitment to partner with the Egyptian government in “bringing more customer choice and economic benefits to the people of Egypt.”

MAF is using the expansion to wide in its footprint in Egypt, including new hypermarkets in its City Centre Almaza mall and in Ismailia (in northeast Egypt, between Suez and Port Said). Four of the 20 new 2019 stores opened in Q1 2019: Asmarat, Zagazig, Beverly Hills and Rehab. Aside the two new hypermarkets MAF plans new stores in Alexandria, Damanhur, Mansura and Beni Suef.

Although MAF is not saying it explicitly, Trendtype believes the company is on track to become the largest grocery retail chain in Egypt in 2019, taking #1 from the state owned Food Industries Holding Company (FIHC), owner of the El Nil and Al Masria chains.

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