Rami Levy Chain Stores Hashikma Marketing 2006 Ltd. (TASE:RMLI) CEO Rami Levy has denied reports that he will buy a stake in the Cofix chain but he has confirmed there have been talks on opening Cofix cafes in his supermarkets.
Earlier there had been reports that Levy and Cofix had agreed on business cooperation, in which they would combine forces to promote the chain, and would also open Cofizz supermarkets in competition with Super Cofix.
Under the terms of the emerging deal, Cofizz management would move to Rami Levy's offices, and Rami Levy would put its resources at the disposal of Cofizz, including its shopping centers.
The business plan included opening 200 Cofizz and Super Cofizz outlets throughout the country, with Rami Levy supplying the products for sale in the municipal supermarkets. There are currently 22 Cofizz branches selling products for NIS 5 each.
Adv. Guy Ophir, who is representing Cofizz in the negotiations with Rami Levy, said that signing of the deal was expected in the next few days, after a round of revisions of the draft agreement by the lawyers is finished. A letter sent by the Rami Levy legal advisor to the Cofizz owners said, "We are planning to sign the agreement at the end of next week, God willing."
Cofizz said in response, "We believe that it is not enough to set up supermarkets selling products for NIS 5. Products should be of good quality and in sufficient quantity to make it economically worthwhile, not just as a gimmick. That is why we decided to join forces with Rami Levy, who has already proved himself as someone who can supply merchandise at a price that is worthwhile for everyone."
Under the draft agreement, NIS 500,000 will be given to the Cofizz owners. "NIS 250,000 and the par value of the shares will be paid to the sellers by the buyer when the agreement is signed, in exchange for delivery of a signed share transfer deed, a signed notice for the Registrar of Companies about the transfer, and any other necessary document to the trustee, as listed above," the agreement states. "NIS 250,000 will be paid to the sellers by the buyer after registration of the transfer of shares at the Registrar of Companies."
A Channel 2 News broadcast last month included an investigation that revealed that not all the products at Super Cofix were inexpensive and worthwhile, because the contents of the products had been reduced. Various products are available in the supermarkets, but almost none of them are branded goods, such as Coca Cola.
Entrepreneur Avi Katz, who started the Cofix chain, said that four more Super Cofix branches were planned in the near future, and hundreds more in the more distant future.
Published by Globes [online], Israel business news - www.globes-online.com - on June 14, 2015
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