GERMANY: Rewe restructuring to boost foreign activities
German retailer Rewe is planning to undertake an extensive restructuring programme with the aim of tightening its portfolio, doubling profitability and taking a more active role in the consolidation of the German and international food retail industry.
Chief executive Achim Egner told Sueddeutsche Zeitung in an interview that the restructuring programme is designed to make Rewe a major player in the European and international food retail market. It is hoped that Rewe's international food retail operations will increase by 10% to 40% and in the medium term to 50-60%.
In particular, Rewe hopes to expand in Eastern Europe and Russia, and around half of 2006's investment budget of more than EUR€1bln (US$1.2bln) is being earmarked for international purposes.
Rewe has set a goal of reaching a sales margin of 2-3 % in the medium term, from today's 1.5%.
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