Ljubljana, 18 December (STA) - Mercator-H, the Croatian subsidiary of Slovenia's biggest retail chain, Mercator, and Croatia's retailer Getro signed on Friday in Zagreb an agreement under which Mercator will take over Getro's 16 shopping centres, brand name and its employees.
Subject to approval from the Croatian competition protection office, the merger agreement will create the second-largest retail chain in Croatia, with over 4,500 employees, 110,000 square metres of shopping and an estimated 9% market share.
Marcator's market share in Croatia stood at 6% at the end of 2008. It currently operates 11 hypermarkets, 26 supermarkets and over 30 other shops across Croatia.
"The strategic merger represents a step forward in Mercator's growth strategy, bringing it a closer to becoming the biggest food retailer in Southeast Europe," Mercator said in a press release.
Reports surfaced in April 2009 that Mercator was eyeing Getro, but was only one of 12 potential buyers - these included retailer Konzum, Kaufland, Metro and eight investment firms.
Getro, which has reportedly been having financial difficulties in the past years, is in majority ownership of Croatian businessman Vjekoslav Gucic, while a smaller stake is held by the European Bank for Reconstruction and Development.
Mercator revenues in Croatia stood at EUR 361m in 2008, which is around 13% of total group revenues. Getro, which has some 1,400 employees, generated EUR 238m in sales revenues last year.
Separately, Mercator announced today it would take internal restructuring measures in 2010, which include sending 68 of its support staff in Slovenia on paid leave for about 6 months until vacancies are found elsewhere in the group.
The group also announced that internal restructuring at groups headquarters would result in the division of business activities at group and operations levels in a bid to provide for faster and more effective decision-making.
As part of this three distinct sectors will be created: strategic, which will be in charge of development; real estate, which will manage the group's vast real estate assets; and retail, which will be charge of the core activity in Slovenia.
In addition, new companies will be created specialising in the field of sports equipment retail, Intersport ISI, and clothing retail, Modiana, bringing the number of Slovenian subsidiaries to eight.