Lenta to acquire Kesko food retail business in Russia from Kesko - Information portal

Lenta to acquire Kesko food retail business in Russia from Kesko

(votes: Lenta to acquire Kesko food retail business in Russia from Kesko, rating: 0)

26.10.2016 Количество просмотров 660 views
lenta.jpgfoto: alcoexpert.ru

Lenta, (LSE, MOEX: LNTA) one of the largest retail chains in Russia, and Kesko are pleased to announce they have reached an agreement under which Lenta will acquire Kesko’s food retail business in Russia (“KFR”), currently operating under the K-Ruoka brand.

KFR consists of 10 hypermarkets and one supermarket operating under the K-Ruoka brand in Saint-Petersburg and the Leningradskiy region, as well as three land plots in Moscow and the Leningradskiy regions. Most of the hypermarkets were opened in 2012-2015 and two stores were opened during 2016. Total selling space of the acquired stores is around 42.5k sq.m, of which around 40.2k sq.m are owned and around 2.3k sq.m are rented. The stores are compatible in terms of size and layout with existing Lenta compact and supercompact hypermarket formats, and almost all of the store locations are complementary to Lenta’s existing stores in Saint-Petersburg and the Leningradskiy region. The high proportion of owned stores is in line with Lenta’s store ownership strategy. The KFR business and assets are owned by six legal entities which will be purchased as part of the transaction.

Lenta’s Chief Executive Officer, Jan Dunning said: “We are very pleased to have reached an agreement with Kesko to acquire their business in Russia. While Lenta remains primarily focused on its successful organic expansion, we welcome opportunities to augment this by acquiring high quality assets such as the Kesko stores. The stores all have excellent urban strategic locations and are complementary to Lenta’s existing network. They have a strong team of well-trained store staff who we look forward to welcoming into the Lenta family. Completion of the acquisition will significantly strengthen Lenta’s network in Saint-Petersburg, giving many more customers the opportunity to shop at a Lenta store close to their homes. Upon the completion of integration the stores will operate under the Lenta brand.”

According to the agreement the aggregate transaction consideration is Rub 11 bn.

The transaction has been approved by the Lenta and Kesko Boards, no further internal approvals are necessary. The transaction is expected to close on November 30, 2016 subject to fulfilment of the other terms and conditions and approval by Federal Antimonopoly Service of the Russian Federation (“FAS Russia”). The acquisition will be financed using Lenta’s existing cash and available undrawn long-term loan facilities.** Lenta will provide more details and revised guidance upon completion of the acquisition.
Source:  Lenta


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