November 17, 2011

Edeka eyes Dutch retailer C1000

C1000 supermarket interior (photo: Prinsenbeek)
Attractive interior: A C1000 supermarket in the Netherlands (photo: Prinsenbeek)
Evidence is mounting that Edeka Group is in the second round of bidding for Dutch supermarket retailer C1000. The Hamburg-based retailer co-operative is believed to be offering between €900m and €1bn for a deal which could be concluded by Christmas. Edeka will have to outbid a number of rivals: Jumbo Group, Sligro Food Group, private equity companies Bain Capital and BC Partners as well as, possibly, Sperwer Groep (Plus). Edeka is Germany's largest food retailer with 12,000 outlets across a broad range of logos and formats. These include "E aktiv markt" and "E neukauf" supermarkets, "Netto" discount stores, "nah & gut" neighbourhood stores, and "Marktkauf" hypermarkets. C1000 stores are similar in size to Edeka's supermarkets and average 900m². They carry an assortment of around 11,000 lines, 2,000 of which are own label. But it won't be a marriage of equals.
November 10, 2011

Ex-Waitrose CEO Esom talks private equity

Steve Esom, Partner Langholm Capital (photo: Mackenzie Brothers)
Steve Esom: "We are not locusts" (photo: Mackenzie Brothers)
Former Waitrose CEO Steven Esom joined the board of Marks & Spencer in 2007 to head food development. But the Englishman left his new employers after only one year in order to work as an investment partner for London-based private equity fund Langholm Capital. Esom thus belongs to the growing number of top retailers who have jumped saddle for the investment industry. A by no means exhaustive list of former CEOs or Chairmen who have already taken the high road to private equity includes Sir Geoffrey Mulcahy (ex-Kingfisher), Daniel Bernard (ex-Carrefour), Luc Vandevelde (ex-M&S), Sir Terry Leahy (ex-Tesco) and Andy Bond (ex-Asda). Clearly some of them had simply reached retirement, but the relatively young ages of Esom (then 47) and Bond (today 45) indicate that we are dealing with a broader phenomenon. So why has nice-guy Esom chosen the dark side?
November 2, 2011

Talk with Printemps investor Maurizio Borletti

Maurizio Borletti, CEO Borletti Group (photo: Borletti Group)
Visionary investor: Maurizio Borletti at the Printemps flagship store on boulevard Haussmann (photo: Borletti Group)
Maurizio Borletti is the personification of what the Germans call "old money". Cultivated charm belies his own description of himself as a "salesman". The Italian investor thus made a somewhat incongruous figure when he burst upon the German retail scene last year with a bid for insolvent department store chain Karstadt. In the event, he lost out to US-German investor Nicolas Berggruen in June 2010 after a highly-publicised bidding war. Is the co-owner of French department store icon Printemps on the acquisitions trail again in Germany? Market leader Metro Group has long wanted to sell its lacklustre Galeria Kaufhof department stores. But potential investors find the high price the owners are asking about as sexy as stale beer.
October 26, 2011

Ex-Asda CEO Andy Bond restarts as investor

Andy Bond, CEO Woodcliffe Associates (photo: Asda)
Andy Bond: "If I looked as a big foreign investor at Metro Group, I would first want to understand the exposure its formats would give to emerging markets" (photo: Asda)
Although he doesn't like the term because it sounds too self-congratulatory, polite and pleasant Andy Bond has become a business angel. After a distinguished career as CEO and later Chairman at Asda/Walmart, this northern Englishman surprised the trade by leaving the UK's no. 2 food multiple as per September 1 at only 45. He did so to create his own investment & management company, Woodcliffe Associates Ltd. It was certainly a bold and unconventional move that sets him apart from most other male top managers who cling to the seat of power far beyond their sell-by date. But why does a man running a group with estimated annual revenues last year of £19bn (€22bn), jack it all in so that he can promote small and medium-sized enterprises?
October 19, 2011

Spar Austria's Markus Kaser talks Interspar

Markus Kaser, MD Interspar (photo: Spar Österreich)
Markus Kaser: "We are not a big foreign group coming to Austria from who knows where" (photo: Spar Österreich)
If Asterix was a retailer and came from Austria rather than Gaul, he would be called Spar Austria (Österreich) and have his base in beautiful Salzburg. And should you want a local hero standing proud against foreign might (Rewe Group and Aldi in the form of "Hofer" from Germany), then think Interspar, Spar Österreich's hypermarket arm. In fact, Interspar's 66 first-class hypermarkets are rooted in home soil like stalwart pine trees. If you then desire an MD that is as homely and authentic as the company he works for, then think Markus Kaser. Small wonder that Austria's second-largest food retailer plays the local card for all it is worth. Kaser is a retailer's retailer with a detailed knowledge of the stores and assortments. The main subject of this interview, the marketing magic of local and regional assortments, was therefore right in his neck of the woods.
October 12, 2011

Professor Peter Singer slams cruelty to animals

Professor Peter Singer (photo: Andrew Wilkinson)
His brother's keeper: Moral philosopher Peter Singer wants us to be kinder to other species (photo: Andrew Wilkinson)
If Peter Singer had his way, we should consume a lot less (including such delightful things as ice cream and coffee). He would also have us give 5 per cent of our annual income to charity and refuse to eat mass-produced meat. No, this is not a man holding a placard at Oxford Circus in the rain, but an internationally prominent thinker. His titles include Professor of Bioethics at Princeton University's Center for Human Values and Laureate Professor at the Centre for Applied Philosophy and Public Ethics at the University of Melbourne. Singer has stirred controversial debate far beyond the ivory towers of academia. His views on ethics have stimulated controversy on such emotive subjects as abortion and euthanasia, but it is his views regarding animal welfare and consumerism which concern us here.
October 4, 2011

Germany in Anuga trade fair fever

Anuga exhibition hall plan (photo: Anuga)
Now's your chance: Come and visit our newspaper's stand at the Anuga trade fair in Cologne! (photo: Anuga)
Beat the food packet, bang the drinks can, it's Anuga-time again! The world's largest trade fair for the food & beverage industry is open to trade visitors in Cologne from 9 a.m. to 6 p.m. on Saturday, the 8th of October to Wednesday, the 12th of October. At its 31st fair, Anuga will host nearly 6,600 exhibitors from 100 countries who will cover well over a quarter of a million square metres of gross exhibition space – a spectacular achievement in this digital age. 86 per cent of the exhibitors will be coming from abroad with the largest contingent from Italy, Anuga's partner country for 2011. The last Anuga fair in 2009 saw around 150,000 visitors, 60 per cent of whom were non-German. So are you coming this time?
September 30, 2011

German retail concentration end game

Alois Kettern, CEO Wasgau (photo: Thomas Merkt)
Wasgau CEO Alois Kettern: "We must secure the future of Wasgau in an increasingly competitive arena" (photo: Thomas Merkt)
At first blush, Rewe Group's indirect participation in Wasgau on Wednesday would seem a comparatively small event in the greater scheme of things. After all, Germany's second-largest food retailer has only taken a 25.1 per cent minority stake in Wasgau Food Beteiligungsgesellschaft mbH, a holding company majority-owned by DIY pioneer Otmar Hornbach which in turn controls 53.1 per cent of Wasgau's share capital. But Rewe's move surely also can be interpreted as one of the last consolidation moves on a German food retail market three-quarters of which is dominated is already dominated by an oligarchy of five (Edeka, Rewe, Metro Group, Schwarz Group, Aldi Group). Both parties have declined to specify the price of the transaction, but Wasgau CEO Alois Kettern has never entertained any illusions about the long-term chances of regional multiples on Europe's largest market over half of which is dominated by hard discounters:
September 23, 2011

Aldi's new store concept

Aldi store in Gent (photo: Horst Wagner)
Tired of being drab: Aldi Nord has spruced itself up in Ghent (photo: Horst Wagner)
Believe it or not, this grim-looking building represents a trendy new look for Essen-based hard discounter Aldi Nord (Aldi North), the frumpy sister of Aldi Süd (Aldi South). Aldi North's Belgian subsidiary has just opened its first "new generation" store in Mariakerke, a suburb of the pretty Flemish town of Ghent. Retail experts believe that Aldi North could be testing this outlet in advance of an international rollout. There is also a trade rumour that the Ghent branch is a prototype for a revised concept soon to see the light of day in the German city of Lübeck. Currently Aldi North (annual revenues: €2.8bn) runs 445 branches in Belgium. As in the Netherlands, these are even more Spartan than the ones it runs in Germany. Instead of the usual sombre corporate brown tones, lucky shoppers can now experience a strong "Aldi-blue" logo. More glass is used in the facades of the building and part of the ceiling so that even thrifty shoppers may enjoy more of that free commodity, natural daylight. In an orgy of extravagance, customers are treated to light flooring, and even the price signs have been changed to white from an old-fashioned red/orange.
September 17, 2011

Rewe Group starts online food delivery service

Alain Caparros (photo: Rewe Group)
Rewe CEO Alain Caparros: "We can't afford to miss major trends" (photo: Rewe Group)
Rewe Group will be the first national multiple in Germany to provide its customers with an online food delivery service. The kick-off is planned for September 29 in the greater Frankfurt area where Rewe is particularly strongly represented. Germany's second-largest food retailer intends to offer a full supermarket assortment, including F&V, dairy products, frozen food, meat and OTC lines. Orders will be picked in-store, and deliveries made via the company's own vehicle fleet for a charge of €5 (€2 for orders over €150). This is the first major online offensive in German food retailing for around a decade. It is also almost certainly a reaction to the challenge thrown down by Amazon.com's entry onto the market in July 2010.