Kuwait’s Alshaya Group reduces Egyptian operations citing FX concerns

Cairo – January 18, 2024: Egyptian shoppers will see a contraction in the number of international brands in the coming months as Kuwaiti retail conglomerate, Alshaya Group, is set to take a step back from the Egyptian market, announcing a decision to scale down operations in the country in response to foreign exchange (FX) pressures and challenging economic conditions.

“As a result of the economic situation over the last three years and the difficulties faced by overseas businesses trading in Egypt, we have taken the very difficult decision to reduce our operations in the country,” Alshaya explained in a statement to media.  

The retail giant is known for managing franchises of major brands such as American Eagle, H&M, and Victoria’s Secret.

The downsizing includes the closure of 5 brands, reduction of branches for three brands, and the closure of 2 online sales platforms, out of a total of 12 brands operated by the group in Egypt.

An internal memo to its local employees was shared by media on Wednesday. Alshaya Egypt confirmed the authenticity of the internal note, stating that approximately 375 employees in Egypt would be affected, out of a total of 2,000 working for the group in the country.

Debenhams, a brand under Alshaya, is slated for complete closure in Egypt, encompassing both physical store shutdowns and the end of e-commerce operations by the end of February 2024.

Additional closures are expected for The Body Shop, Mothercare, and Bank Bazaar, which will shut down all operations.

Partial closures are anticipated for H&M, Victoria’s Secret, American Eagle, and Bath & Body Works.

Alshaya stated that it remains committed to Egypt, and is looking to continuing trade and “hopefully growing again in the near future.”

It will retain a total of around 100 stores, including 79 Starbucks branches, the spokesperson told Bloomberg, declining to be identified in line with company policy.