Delhaize Group Selling Czech Business
BRUSSELS, Belgium -- Delhaize Group, the international food retail conglomerate here, said yesterday that it has come to a binding agreement to sell Delvita, its Czech business, to the German retail group Rewe, which runs Billa supermarkets and Penny Market discount stores in the Czech Republic, for 100 million euros, subject to contractual adjustments.
When Delhaize posted its third-quarter financial results Nov. 9, it revealed that it would sell its Czech operations.
Noted Delhaize president and c.e.o. Pierre-Olivier Beckers in a statement: "Some days ago, we announced that we had taken the difficult decision to sell our Czech activities after careful evaluation of their contribution to our portfolio and their future requirements....[W]e are satisfied to announce that we have reached an agreement with Rewe, as we believe the combination of Delvita and Billa will result in a strong competitor in the competitive Czech market and create continuity and opportunities for our people in the new organization."
Delhaize entered the Czechoslovakian market in 1991 through the then newly founded subsidiary Delvita. In 2005 Delvita sold its Slovakian stores to Rewe. At the end of September 2006 Delvita's sales network consisted of 95 stores. In 2005 Delvita reported sales of 282.2 million euros and an operating loss of 1.5 million euros. At the end of 2005 Delvita employed about 3,800 associates.
The agreement foresees that all of Delvita's contractual employees will continue under Rewe's ownership.
Delhaize is present in eight countries on three continents. At the end of September 2006 the group operated 2,676 stores, including Food Lion and Hannford Bros. in the United States. At the end of 2005, the company employed about 135,700 people.
When Delhaize posted its third-quarter financial results Nov. 9, it revealed that it would sell its Czech operations.
Noted Delhaize president and c.e.o. Pierre-Olivier Beckers in a statement: "Some days ago, we announced that we had taken the difficult decision to sell our Czech activities after careful evaluation of their contribution to our portfolio and their future requirements....[W]e are satisfied to announce that we have reached an agreement with Rewe, as we believe the combination of Delvita and Billa will result in a strong competitor in the competitive Czech market and create continuity and opportunities for our people in the new organization."
Delhaize entered the Czechoslovakian market in 1991 through the then newly founded subsidiary Delvita. In 2005 Delvita sold its Slovakian stores to Rewe. At the end of September 2006 Delvita's sales network consisted of 95 stores. In 2005 Delvita reported sales of 282.2 million euros and an operating loss of 1.5 million euros. At the end of 2005 Delvita employed about 3,800 associates.
The agreement foresees that all of Delvita's contractual employees will continue under Rewe's ownership.
Delhaize is present in eight countries on three continents. At the end of September 2006 the group operated 2,676 stores, including Food Lion and Hannford Bros. in the United States. At the end of 2005, the company employed about 135,700 people.