Egypt Government to have a grip on Two Brotherhood-led Supermarket Chains

The two market chains closed just a day before by authorities, Seoudi and Zad supermarkets, will be placed under the control of the state-owned Egyptian Food Industries Holding Company (FIH).

Egypt’s Ministry of Supply announced on Monday that two market chains will be placed under FIH’s control, Al-Ahram’s Arabic news website reported.

Egypt’s FIH handles 650 wholesalers and 210 retailers nationwide under the aim of providing Egyptians with low-price staples.

The two supermarket chains were ordered on Sunday to be shut and placed under government surveillance on accusations of backing the outlawed Muslim Brotherhood group.

According to Al-Ahram, the supply ministry will re-operate the chains after finishing the commodities’ inventory, adding that the workers’ rights and payments will not be touched.

Zad market, which opened in 2012, is owned by prominent Brotherhood leader and businessman Khairat El-Shater, now in jail on a variety of charges. The market has 15 stores in Cairo’s Nasr City district.

Seoudi, however, was established in 1938. Its approximately nine branches were owned by the businessman Abdel-Rahman Seoudi, who was arrested in 2007 and later acquitted of charges of belonging to the banned group.

An anonymous source familiar with the matter told Ahram Online that Seoudi won’t be available for comments, as he is currently outside Egypt.

The source added that the government takeover of the store “can be described as destroying the investments in the country.”

“Seoudi has employed 8,000 workers and around 25 percent of them have preferred to find another place [to work] after the decision,” the source said. “The rest will remain under the government’s control.”

Walid El-Badry, the coordinator of the Brotherhood’s political arm, the Freedom and Justice Party, told Al-Ahram earlier on Monday that Zad’s assets are worth roughly EGP 1.5 billion, while the assets of Seoudi total around EGP 800 million.

“The decision came as the government has fears of the Brotherhood’s usual charity activities, especially in Ramadan, like granting poor families their needed commodities for free,” El-Badry was quoted as saying.

The governmental crackdown on Brotherhood members and their activities started last year following the ouster of president Mohamed Morsi, who hailed from the group.

In April, the large Egyptian supermarket chain Al-Mahmal, which was owned by businessman Hussein Harb, was sold to Awlad Ragab’s retailer in a EGP 2 billion deal. Al-Mahmal had 33 branches nationwide.

Harb sold Al-Mahmal because he thought he would face the same fate as thousands of other alleged Brotherhood-affiliated institutions, NGOs and businesses whose funds were all frozen by the government, a former worker in Al-Mahmal told Ahram Online on condition of anonymity.

“The problem is that the authorities are raiding pious Muslim on suspicion of being linked to the Brotherhood, which isn’t true,” the former employee said.