RUSSIA: X5 Retail buys out franchisee
X5 Retail Group has completed its buy-out of the Urals-based franchisee that operates the Pyaterochka chain of supermarkets in the cities of Yekaterinburg and Chelyabinsk.
In a deal worth RUB576m (US$18m), X5 took full control of the chain through the acquisition of the 25% stake in the venture it did not already own.
Russia's largest retailer announced today (2 June) that it decided to consolidate its ownership of the business in order to improve results by leveraging synergies.
The Pyaterochka chain operates 103 stores in the Urals region, and generated revenue for RUB6.8bn last year.
CEO Lev Khasis said: "In the two years since X5 has been managing Pyaterochka business in Yekatarinburg and Chelyabinsk, we have almost tripled selling space, secured leading positions in both regional cities, substantially increased sales per square meter in LFL stores and enhanced profitability.
"This is a prime example of our successful development of franchisee relationships to the benefit of both X5's shareholders and partners".
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