St. Petersburg, Russia, 2017-Nov-11 — /EPR Retail News/ — Lenta Ltd, (LSE, MOEX: LNTA / “Lenta” or the “Company”), one of the largest retail chains in Russia, is pleased to announce an agreement has been reached with the Holiday Group to purchase 22 supermarkets in the Siberia region.
The assets to be acquired consist of 22 owned supermarkets currently operated under the “Holiday Classic”, “Kora” and “Holdy” brands. 11 of the stores are located in Novosibirsk, 7 in Kemerovo and 4 Barnaul. The average selling space per store is around 800 square meters, giving total selling space of approximately 18 thousand square meters. The stores are compatible with Lenta’s supermarket format in terms of size and layout, and the locations are complementary to Lenta’s existing stores.
Lenta’s Chief Executive Officer, Jan Dunning said:
“Lenta is pleased to announce an agreement to acquire 22 supermarkets in Siberia from the Holiday Group. This transaction will significantly strengthen our network in Siberia, giving many more customers the opportunity to shop at a Lenta store close to their homes. The stores all have good urban locations and are complementary to Lenta’s existing network.
Siberia is an important region for Lenta. The company opened its first hypermarket in Novosibirsk in 2006 and its first supermarket in the city earlier this year. We currently operate 36 hypermarkets and 4 supermarkets across Siberia, served by our distribution centre in Novosibirsk.
While Lenta remains primarily focused on organic expansion, we are happy to supplement this by acquiring high quality existing stores when suitable opportunities arise. We have a strong track record of successful integration and look forward to welcoming former Holiday store employees into the Lenta family. The stores will be refurbished and rebranded over the next few months.”
Approvals and integration
All the stores are expected to transfer to Lenta ownership before year end 2017. The transaction does not require any regulatory approvals.
The stores will be closed temporarily for refurbishment and rebranding as Lenta stores, with all works expected to be completed by end March 2018.
Lenta 2017 Guidance
Lenta’s existing guidance of about 50 supermarket openings in 2017 with capital expenditure in the range of RUB 30-35bn remains unchanged.
Lenta is the largest hypermarket chain in Russia and the country’s fourth largest retail chain. The Company was founded in 1993 in St. Petersburg. Lenta operates 204 hypermarkets in 79 cities across Russia and 69 supermarkets in Moscow, St. Petersburg, Novosibirsk, Yekaterinburg and the Central region with a total of approximately 1,223,933 sq.m of selling space. The average Lenta hypermarket store has selling space of approximately 5,700 sq.m. The average Lenta supermarket store has selling space of approximately 900 sq.m. The Company operates seven owned distribution centres.
The Company’s price-led hypermarket formats are differentiated in terms of their promotion and pricing strategies as well as their local product assortment. The Company employed approximately 40,400 people as of 30 June 2017.
The Company’s management team combines a mix of local knowledge and international expertise coupled with extensive operational experience in Russia. Lenta’s largest shareholders include TPG Capital and the European Bank for Reconstruction and Development, both of which are committed to maintaining high standards of corporate governance. Lenta is listed on the London Stock Exchange and on the Moscow Exchange and trades under the ticker: ‘LNTA’.
A brief video summary on Lenta’s business and its Big Data initiative can be seen here.
Forward looking statements:
This announcement includes statements that are, or may be deemed to be, “forward-looking statements”. These forward-looking statements can be identified by the fact that they do not only relate to historical or current events. Forward-looking statements often use words such as “anticipate”, “target”, “expect”, “estimate”, “intend”, “expected”, “plan”, “goal”, “believe”, or other words of similar meaning.
By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances, a number of which are beyond Lenta’s control. As a result, actual future results may differ materially from the plans, goals and expectations set out in these forward-looking statements.
Any forward-looking statements made by or on behalf of Lenta speak only as at the date of this announcement. Save as required by any applicable laws or regulations, Lenta undertakes no obligation publicly to release the results of any revisions to any forward-looking statements in this document that may occur due to any change in its expectations or to reflect events or circumstances after the date of this document.
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