SPAR Austria-owned SPAR Croatia is set to acquire Rewe Group’s 62 Billa stores in the country, along with a logistics centre at Sveta Helena. The acquisition requires approval from the Croatian Competition Agency (AZTN), but this is unlikely to be an issue given that the combined company will have a market share of about 8%, far behind market leaders Konzum and Lidl.
Acquisition grows SPAR’s presence in the market
The purchase of the 62 Billa stores will almost double SPAR’s network in Croatia, where it operates 19 hypermarkets and 38 supermarkets. It will also enable SPAR to grow its presence in the supermarket channel, the Billa stores range in size from 500 to 1,500 sq. m, which has better long term prospects than its hypermarkets. The purchase will also allow SPAR to focus on its key grocery ranges, maximise its opportunity in food-to-go and aiding shoppers’ growing desire to shop little and often.
While disposal enables Rewe to focus on core operations
Over the last few years, Rewe has exited markets, especially the Billa fascia, to focus on those where it believes it can win. In the last 12 months Rewe has exited Bulgaria and Romania, while leaving Italy in recent years as well. Rewe will remain in Croatia, with its BIPA drugstores fascia.
This strategic focus on key markets was highlighted by Rewe International board member Frank Hansel when discussing the disposal in Croatia; “Our strategic objective in countries where our stores are present is to achieve the leading market position. Despite targeted investments, in the past we were not able to achieve that in Croatia, and according to our current assessment that will not be feasible in the foreseeable future as well.”