Russia’s largest supermarket chain Pyaterochka today unveiled the US$220m acquisition of the Moscow-based Merkado chain, which, the company said, will increase selling space and improve the company’s logistics.

The deal includes Merkado’s 16 supermarket outlets, with floor space of approximately 50,000 square metres, and a distribution centre. The acquisition is expected to add $110m to the revenues of the next fiscal year.

Pyaterohka will pay $35m for the distribution and office centre, which is located in central Moscow and has a capacity of more than 17,000 square meters. The deal includes total retail premises of approximately 33,000 square metres.

Lev Khasis, group chief executive officer, said: “After the closing of the transaction, the acquisition of the Merkado assets will significantly enhance our already leading position in the most important market of Russia – the city of Moscow. The supermarkets are located in attractive locations with a strong existing customer base and can be easily integrated into the group’s existing formats. The distribution and office centre near the city centre is a valuable addition to our real estate portfolio and is also expected to be used as the corporate office of the group, allowing us to consolidate numerous leased office locations around the city which will certainly save our rental costs as well as improve management and communication.”    

Andrei Gusev, group director for mergers, acquisitions and business development, added: “This transaction clearly reflects the increased number of opportunities and potential acquisition targets which we now enjoy as a combined entity, following the merger of Pyaterochka and Perekrestok this spring.”