Russian retailer X5 Group said it had agreed to acquire Victoria and Deshevo stores operated by Victoria Baltia in the Kaliningrad region, a Russian exclave on the Baltic coast.
The deal encompasses 118 stores with a total selling space of 92,000 square metres, including leased facilities. In addition, X5 will take ownership of two distribution centres in the Kaliningrad Region with a total space of 14,200 square metres, X5 said in a statement.
According to Vedomosti, the market value of the Victoria chain, taking into account its lack of debt obligations, may be 9 billion rubles.
The current management team of Victoria Baltia will continue to manage the company.
“The Kaliningrad Region is an exciting market that has high growth potential for X5 Group’s business, while also having a unique profile. In particular, it offers a limited number of locations to open new stores. The deal to acquire Victoria and Deshevo stores will help to consolidate our position in the Kaliningrad Region while improving the logistics support for our stores in this market,”
said X5 CEO Igor Shekhterman.
Russia’s FAS in turn reported that it approved the deal on condition of fulfillment of the regulator's order.
"Since the share of X5 Group exceeded 25% of the volume of all sold food products in monetary terms for 2022 within the boundaries of the urban district of Dolgoprudny, Moscow region, Victoria Baltia must before the transaction to transfer the retail facilities located in this territory to third parties,"
the agency said in a press release stated.
In addition, FAS ordered to extend all existing voluntary obligations of the retailer related to pricing to certain items of socially important goods. In addition, X5 must fulfill all contracts concluded by the acquired company with its counterparties.
In 2022, Victoria Baltia LLC revenue amounted to RUB 40.9 billion and net profit amounted to RUB 846.6 million.
X5 Group operates stores of Pyaterochka, Perekrestok and Chizhik retail chains, develops e-commerce projects Vprok.ru and 5Post and others.
As of June 30, 2023, X5 operated 22.7 thousand stores and 59 distribution centers.
