Fast-growing Russian food retailer Magnit is interested in acquiring smaller rivals as growing competition is set to leave less room for organic expansion, its CEO said on Friday.
“Competition is growing every day but we still have opportunities for more or less comfortable growth. What we see is the trend of replacement of second-tier chains and probably we all – (rivals) X5, Dixy and ourselves – are showing interest,” Sergei Galitskiy said.
Magnit has grown into Russia’s top food retailer by store count via organic expansion and also ranks second to X5 Retail Group in revenue terms.
Last year, it paid $32 million for a chain of some 14 stores in the Tambov region in central Russia, and plans to buy the remaining interest for $3.6 million this year, it said in audited full-year financial report on Friday.
Magnit and X5 control between them under 10% of the Russian food retail market which is widely expected to consolidate mainly at the expense of small regional chains and unorganized retail.
Source: www.freshplaza.com