Russian retail will continue to consolidate

We remind that in the first half of this year, the domestic market was shocked by large transactions – the acquisition of the retail chain Dixie by Magnit, and the two retail chains Billa and Semya by Lenta.

Anastasia Volokhova, Director of Strategy and Transformation, LENTA, commented on the situation:

‘We stated in our strategy that we are switching to small formats, so for us both deals with Billa and Semya are an opportunity to acquire those competencies that we lack. As for Billa - this is a strong ultrafresh, as for Semya – this is own production. In addition, we approach this as an opportunity to identify the strengths of these retail chains that we want to introduce into our format. We have entered an active stage of consolidation and together with other active retailers we will take part in this game.

Sergey Leonov, co-founder of the Alliance of Regional Retailers, CEO of the retail chain Khoroshiy vybor (Good Choice), said that in 2021 his company bought the hypermarket Siberian Giant and by the end of this year another deal is planned "to acquire one retail chain", which is currently being considered.

‘It is good to buy not just a retail chain, but also a market share,’ the expert believes. ‘There are very few companies with a purchase turnover of more than 100 billion rubles in our market. After the takeover of Dixie, two retail chains remained – Monetka and Maria-Ra. I think that if these companies do not have their own strategy to become a leader of consolidation, then we will see what can happen to them in the near future. Integrators can buy them – the first three in offline sales - X5, Magnit and Lenta. These integrators are actively present in the western part of the country, but there are few of them in the east. Which should I buy there? There are 6-8 retail chains that make up a large share of the market there. I believe that in the next year and a half we will see information about M&A transactions.’

As the moderator of the plenary discussion Kirill Tereshchenko, CEO of KOTANI, clarified, ‘rumors have been circulating about Monetka for a long time and it became known that a preliminary merger agreement was signed in the second quarter.’

Alexey Grigoriev, head of the Moscow representative office, METRO believes that the market will change, as demand, channels of interaction with consumers, consumer preferences change; there is competition in the manufacturers ' market.

‘We are all in a lively and very mobile environment, and this process is non-stop,’ the head concluded. ‘Where is the specific point where we will come, I do not know, but there are examples of other countries. In Europe, for example, 4-5 retail chains occupy 70-80% of the retail market. Whether we will come to this, we do not know - our country is completely different. The consolidation process will take place both offline and online, and this is obvious.