Slovenian retailer Mercator is mulling the sale of its units in Albania and Bulgaria in a bid to boost its bottom line.
Last month, Mercator warned of rising raw materials costs and “profound recession” in many of its key markets after swinging to a net loss in the first half of 2012.
For the six months to the end of June, Mercator reported net losses of EUR16.5m (US$20.7m), versus profits of EUR18.5m in the same period of 2011. Its move into the red comes amid challenging market conditions.
A spokesperson for Mercator confirmed to just-food today (6 September) Mercator is mulling a sale of its businesses in Albania and Bulgaria.
“Mercator is considering alternative options for these markets, but have not adopted any final decision yet.”
The retailer has also targeted cost savings of around EUR60-80m per year over the next three years through improving logistics and seeking new suppliers.
The spokesperson said cost savings will also be achieved through the sale of some real estate.
“A real estate sale in two tranches should result in EUR300m total, but the final result will be known after the monetisation will be completed, hopefully until the end of this year.”
In a presentation last month accompanying the group’s results, the retailer said cost control measures are “merely the first step in the process of reinventing Mercator”.
The company said it wants to “revise the business trend and put the company in a good shape”, and to “maximize” return on investment to shareholders.