Poland’s Office of Competition and Consumer Protection (UOKiK) has granted 'unconditional merger clearance' for the acquisition by Eurocash Group of Mila S.A., a chain of 187 supermarkets located predominantly in central Poland.
Eurocash is now poised to acquire 100% of the shares of Cypriot company Domelius Limited, which controls Mila S.A..
Once the transaction is finalised, Domelius will be dissolved and the Milk stores will transfer entirely into Eurocash's ownership, the company said.
In a statement, Eurocash said that the 'transaction is the next step to strengthen the market position of thousands of independent entrepreneurs running retail stores in Poland. Innovative solutions and experience of Mila chain, which is the part of so-called modern trade, will be available to all Eurocash Group clients.'
The Mila business generated around PLN 1.48 billion worth of sales in 2017. The transaction to acquire the Mila chain is valued at PLN 350 million.
Improved Competitiveness
“Improving the competitiveness of retail stores operated by independent entrepreneurs in Poland remains our key objective," commented said Jacek Owczarek, CFO and member of Eurocash Group’s management board.
"A large [number] of our clients are already doing quite well against the competition. But in order for them to compete in the future against discounters, we want to deliver the tools, scale and solutions allowing them to compete much more fiercely. Having our own locations, we can improve effectiveness in the area of logistics, marketing or the negotiation of purchasing terms for our clients that are more in line with those enjoyed by the discounters today.”
Once the deal is completed, Eurocash said that it will focus on improving the operational effectiveness of the stores, particularly in the fresh departments.
'Experienced Partner'
“Following the transaction, the Mila chain will benefit from the support of a stable and experienced partner with which we will be able to develop our stores," said Artur Góralczyk, President of the Management Board of Mila S.A.
"We are, and we will remain, close to our clients, who appreciate our pleasant service and high quality, especially in fresh products. The transaction means that our clients can be certain that they will continue benefitting from attractive promotions while shopping in a pleasant setting. Exchanging experiences with Eurocash Group will have a positive impact on the competitiveness of every store in the Group."
The deal is expected to be completed in the coming weeks, Eurocash added.
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
