Two hedge funds have urged Dutch retailer Royal Ahold to divest its US businesses and focus on the European market.
Paulson & Co and Centaurus Capital, which together hold 6.4% of Ahold’s issued ordinary shares, said in a statement they are jointly investigating options to create value for company stakeholders.
Royal Ahold director of media relations Walter Samuels told just-food that although Ahold has taken note of the statement, no further dialogue has taken place.
“Ahold does not comment on market speculation,” he added
The hedge funds said that such a restructuring plan, selling stores including Giant Food, Stop & SHOP and Tops Markets, could be worth in excess of EUR9.00 (US$11.47) per share to stakeholders. The US division represent just under half of Ahold’s growth.
They said: “Paulson and Centaurus believe that the company needs drastic strategic action to deliver shareholder value. We believe keeping Ahold’s disparate retail and wholesale interests together diminishes shareholder value and limits the operating potential of the individual businesses.
“We further believe that one of the best strategic actions to take for the future prospects of the company and for enhancing shareholder value is to sell Ahold’s US businesses and become a pure play European retailer.”
Last week (10 August) Ahold posted second quarter sales of EUR10.48bn (US$13.46bn), an increase of 2.2% from EUR10.45bn reported a year earlier, with revenue particularly flat in the states.
However, Ahold reiterated to just-food that while sales remained unchanged, specific US units performed well, and the company was meeting targets and performing well in the country.