Shufersal to bid for 20 Mega stores

Mega

Israel's largest supermarket chain has expressed interest in buying certain branches - if the regulator permits.

Israeli supermarket chain Shufersal Ltd. (TASE:SAE) will bid for 20 Mega stores, sources inform “Globes”. The Mega supermarket chain has 127 branches 102 “in the city” branches, 8 which operate under the Mega name, 13 Zol Bashefa branches, a lone YOU branch, and three discount YOU stores.

The Mega trustees Adv. Ehud Gindes, Adv. Amir Bartov, and Gabi Trabelsi, CPA have said they wish to sell the supermarket chain in its entirety but experts believe the chain will eventually be split, even if a large chunk of branches are sold to a single buyer.

At the start of the week, the trustees held inquiry meetings with Rami Levy, Tiv Ta’am, Yohananof, and Zvi and Yossi Williger former owners of Willi Food. They continued their inquiry on Wednesday, meeting representatives of Mahsanei Hashuk and Victory.

Shufersal CEO Itzhak Aberkohen told "Globes", “We marked out for ourselves stores that interest us, and now we are in the analysis part, but it will all be in compliance with the Food Law and any required permissions.”

According to the Food Law, any chain store which holds at least 30% of the market share in a specific area cannot open new branches without the permission of the antitrust authority; a chain store with a 50% market share in an area cannot develop further in that region.

Shufersal argues the restriction should apply to the sale of Mega branches, as the acquisition of all Mega branches in one area could carry the buyer over the market share threshold set by the law.

Aberkohen added: “I expect the Food Law will be imposed on the sale. But if any slack is given in its implementation, it should be given to all bidders.”

Sales of NIS 40 million a week

On Tuesday, the trustees filed their plan for the chain’s operations during the stay-of-proceedings to the court. The plan revealed Mega expected to register an operating loss of NIS 15 million for the 30-day period starting January 18. The trustees believe the chain will stabilize its operating losses down to NIS 1.8 million.

The trustees further mentioned they believe the operating loss was driven by a lack of inventory and the urgent need to restock.

Based on their plan, the trustees see sales on NIS 40 million per week, with the hope of raising the figure to NIS 50 million starting in the fourth week of the freeze. They estimated revenue of NIS 190-220 million for the period.

The trustees declared their intention to reach annual sales of NIS 2.5 billion to make the chain attractive to prospective buyers.

Published by Globes [online], Israel business news - www.globes-online.com - on January 28, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

5 Comments
View comments in rows
Update by email about comments talkback
POST
Comments
Your name
Please insert your name
Content
Hyperlink in a new window Hyperlink Right Left underline italic bold Bulleted List Ordered List Face1 Face2 Face3 Face4 Face5 Face6
Your comment

Thanks
You comment was recieved and soon will be published.
In posting comments, I agree to abide by the Terms of Use
Globes encourages lively and frank debate, but posts that the editors consider merely abusive or otherwise inappropriate will be removed. Report inappropriate content
Thank you for posting your comment, which will be reviewed for publication.
Loading Comments...load
Load more comments
Twitter Facebook Linkedin RSS Newsletters גלובס MAD CONFERNCE