retail experts Weigh In on Rimi Baltic Ownership Change

the impending change in ownership of Rimi Baltic, a major grocery retailer, is anticipated to stimulate market growth, according to representatives from various retail companies.

Industry Perspectives on the Acquisition

Dana Hasana, Head of Corporate Communications at Lidl Latvija, suggested that the “Rimi Baltic” ownership transition is “likely to bring new perspectives to the Baltic markets, which will positively promote market growth overall.” This sentiment reflects a broader optimism about the potential for new investment and strategies to invigorate the retail sector.

Hasana further emphasized the positive implications for the region, stating, “It is indeed a positive sign for customers in the Baltic States and the economies of Lithuania, Latvia, and Estonia that, despite geopolitical tensions, this region is considered a good place for investment.”

Despite the changing landscape, “Lidl” remains focused on its core mission.Hasana affirmed, “Lidl will continue to focus on offering its customers a good price-quality ratio for everyday products and continuously improve.”

Elvi Latvija‘s Strategy Amidst Market Shifts

Laila Vārtukapteine, a board member at SIA “Elvi Latvija”, noted that the food retail sector is inherently dynamic. “Food retail is a dynamic and ever-changing environment, so changes in this industry occur relatively regularly, however, a change of ownership for a market player is a noteworthy event.”

The ultimate impact on the Latvian and Baltic markets hinges on the strategic direction of the new owners. Vārtukapteine explained that the specific impact of this deal “will depend on what kind of company growth strategy the new owners choose, and that will only be clear over time.”

According to Vārtukapteine, “Although there are no signals that would lead one to think of radical changes, the inflow of new capital into the industry as a whole makes the market stir, review its work priorities, competitive advantages, and the buyers benefit the moast from this, who can enjoy better price offers, more fascinating promotions and a better level of service.”

looking ahead, “Elvi” plans to invest in fourteen of its branded stores this year, including the opening of five new locations and the renovation of nine existing ones.

Maxima Latvija’s Consistent Approach

Liene Dupate-Ugule, Head of Communications at “Maxima Latvija”, offered a concise statement, indicating that “Maxima” will maintain its current strategy. She stated that, nonetheless of other market participants’ activities, “Maxima will continue to focus on providing low prices for quality goods.”

Financial Performance of Key Retailers

Recent financial data highlights the performance of key players in the Latvian retail market:

• Lidl Latvija: In the financial year spanning from March 1, 2023, to February 29, 2024, “Lidl Latvija” reported a turnover of €470.605 million, a 6.4% increase year-over-year. however, losses also increased 4.1 times to €14.816 million due to ongoing investments in retail development.
• Elvi Latvija: In 2022,the “Elvi Latvija” group’s turnover was €69.981 million, a 50% increase from the previous year, with a profit of €268,383, contrasting with losses in 2021.
• Maxima Latvija: In 2023,”Maxima Latvija” achieved a turnover of €1.073 billion,a 10.1% increase year-over-year, and a profit increase of 84.9% to €56.529 million.

Details of the Rimi Baltic Acquisition

The Swedish group “ICA gruppen” and Danish retail company “Salling Group” have agreed on a €1.3 billion deal for the sale of “Rimi Baltic”, excluding debt.

“Salling Group” President and CEO, Hags, previously emphasized that this is “Salling Group’s largest acquisition deal to date.”

He also confirmed that there are no plans to change the “Rimi” brand.

“ICA Gruppen” CEO, Nina Jenson, stated that the acquisition is subject to regulatory approval.

Jenson further explained that “ICA Gruppen’s” operations are primarily focused on the Swedish market, and “since the group has no plans to expand outside Sweden, the decision to sell ‘Rimi Baltic’ was only logical.”

The transaction includes 314 stores, an e-commerce platform, warehouses, and distribution centers across the Baltics, along with over 11,000 employees.

According to “Salling Group”, the acquisition of “Rimi” will bring their total store count to nearly 2,100 across Denmark, Germany, Poland, estonia, Latvia, and Lithuania, employing over 68,000 peopel.

“salling Group” intends to maintain the “Rimi” concept and invest in new stores, reinforcing “Rimi’s” existing market positions.

“ICA Gruppen” primarily operates in Sweden, with ventures in pharmacies, banking services, insurance, and real estate, along with grocery retail.

The sale of “Rimi Baltic” will provide “ICA Gruppen” with revenue to continue investments and allocate resources to its Swedish buisness, strengthening and expanding product offerings in its core market.

“Salling Group” is Denmark’s largest retailer, owning the “Netto” discount supermarket chain in Europe, as well as other chains like “Føtex” and “Bilka”. “Salling Group” is fully owned by “Salling Foundations”.

“Rimi Baltic” manages “Rimi” retailers in Latvia, Lithuania, and Estonia.In 2023, “Rimi Baltic’s” turnover in the Baltic states was €1.809 billion,a 5.5% increase from 2022.

“Rimi Latvia” reported a turnover of €1.076 billion in 2023, a 4.7% increase year-over-year, with profits rising by 5.8% to €29.09 million.