Published: December 8, 2010
Kopeyka deal expands group’s Moscow exposure.
X5 Retail Group, Russia’s largest retailer in terms of sales, has agreed to buy Kopeyka, a soft discounter selling fresh foods through more than 660 stores.
The deal is worth R51.5bn (US$1.6bn) with its terms including the assumption of debt.
The transaction has been approved by the Russian Federal Anti-Monopoly Service and is expected to close by the end of December.
Andrei Gusev, X5’s M&A and business development director, says that the group has bought a popular business at the right price. “The quality of Kopeyka’s assets was underlined by serious interest from international players, while transaction valuation is in line with recent IPO activity in the Russian retail sector.”
Kopeyka operates soft discounter stores in the European part of Russia, with more than half its business in and around Moscow.
Lev Khasis, X5’s chief executive, says the deal expands the group’s soft discounter presence in the country’s capital city. “Economies of scale and integration of the Kopeyka asset base will further increase X5’s operating leverage in purchasing, distribution and other areas.”
Kopeyka reported net revenues of R59.3bn (US$1.8bn) and EBITDA of R3.8bn (US$121.5mn) for the 12 months to July 2010.