Struggling Dutch retailer Laurus has formulated a new business plan designed to aid the company’s rejuvenation. Laurus announced that it will restructure its operations, adding that it has secured new credit facilities.
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According to Laurus’ business plan, the company intends to position itself in the full service food retail market, emphasising quality fresh produce and adapting its offering to suit the local market.
The company intends to rationalise its store portfolio, reducing the number of Super de Boer outlets from 356 to 310. Laurus added that the present balance between company-managed and franchise stores will remain unchanged. The logistics network will also be downsized to reflect the sale of the Edah and Konmar chains earlier this year. The overhead organisation, the company said, will be reduced to 270 FTEs (Full Time Equivalent posts) from its current 535 FTEs.
The retail chain also predicted that consumer sales will total approximately EUR2bn (US$2.5bn) in 2007.
“The above actions are expected to lead to an improved store base quality and a more efficient support organisation, and will provide Laurus with a sound basis for recovery,” the company said in a statement late yesterday (16 October).
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By GlobalDataCrucially, Laurus announced that it has secured a new EUR170m senior credit facility to be provided by its existing lenders ABN AMRO Bank, ING Bank and Rabobank. The company has secured an additional EUR50m subordinated credit facility from its largest shareholder, French retailer Casino, together with ABN AMRO Bank, ING Bank and Rabobank.
Casino has a stake of 45% in Laurus and now has a new option to take control with a majority interest from July 1, 2007 to March 31, 2009.
The new facilities replace the company’s existing credit agreements, which expire on 30 January 2007.
The secured senior credit facility has a term of 36 months, excluding a 20-million tranche that has a 24-month term. The subordinated credit line has a term of 42 months and an interest rate of 7.5%over EURIBOR rates.
From a previous close of EUR1.96, shares in Lausus had risen by 1.02% to EUR1.98 at time of press, having reached a high of EUR2.07 in volatile trade earlier today (17 October).
