Savola Group Expands Retail Chain with Geant Supermarkets Buy

RIYADH - Saudi-based Savola Group has agreed to pay 440 million riyals ($117.3 million) to buy all Geant supermarkets owned by private Fawaz Alhokair Group.

By Souhail Karam (Reuters)

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Published: Mon 27 Jul 2009, 1:06 AM

Last updated: Sun 5 Apr 2015, 10:30 PM

Savola has signed an agreement with Alhokair to buy Geant supermarket outlets in the kingdom, it said in a statement posted on the bourse website.

“We are taking all the Geant stores in the kingdom, they are 11,” Savola’s Chief Executive Sami Baroum told Reuters. The deal will enable Savola’s retail arm Azizia Panda to raise to 8 from 7 per cent its share of the Saudi retail market and would increase its turnover by 13 per cent, the company said.

The deal gives Alhokair, a major fashion retailer and commercial malls developer, the option to buy a 10 per cent stake in Azizia Panda three years after the signature of the agreement.

“Alhokair is a major retail player with long experience in the development of malls and fashion retail. We want to benefit from this experience,” Baroum said. “Whether he agrees to buy the 10 per cent or not, Geant stores will remain with us”. Savola hopes that Azizia Panda would take within five years a 10 per cent share of the Saudi retail market which it estimated to be currently generating a turnover of 96 billion riyals per year. Azizia, which is 80 per cent owned by Savola, plans to have 120 stores by the end of 2010, double its level in 2008. The deal with Alhokair is Azizia Panda’s second acquisition in two years. In February 2008, Azizia announced the purchase of Giant Stores from Al Muhaidib Group under a share swap deal.

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