Lithuanian retailer VP Market, a company with a turnover of over $1bn last year, has entered the Romanian market by renting a number of shops in Bucharest, market sources say. The Lithuanian company has already signed leases for four shops owned by Practic, a company from Bucharest. Practic used to be the owner of the former Alimentara chain of shops in Bucharest's sector 6; they had also been in talks with the Fortuna chain of food stores in Bucharest.
VP Market's investment manager, Victor Badulescu, confirmed the entry of the Lithuanian retailer on the Romanian market, but provided no information as to the company's future plans. "I cannot offer any information about our future investments," Badulescu said.
"The Lithuanian group has rented four shops from us, a total of 1,600 square metres. A five-year contract was signed. The contract allows for a further five-year extension," explained Florin Mazilu, chief executive with Practic SA Bucharest.
The rental by supermarkets of old neighbourhood food stores (known as Alimentaras) is nothing new. The first deal of this kind was signed last year when La Fourmi, one the leading supermarket chains in Romania, took on five stores belonging to Concordia.
Practic is currently the only company to have been created through breaking up the Alimentaras in every sector of the city, has stuck with the original business and is making reasonably high revenues. It has 13 neighbourhood stores in sector 6 in areas such as Drumul Taberei, Militari and Crangasi. The commercial area of each store ranges from 200 to 250 square metres. Practic's turnover exceeded 9 million euros last year.
VP Market has operations in the Baltic states through its range of stores: Minima (200-800 square metres each), Media (800-2,000 square metres each), Maxima (over 2,000 square metres each) and Hyper Maxima (over 10,000 square metres each).
Last year the Lithuanian company was in talks over the possible sale of its business, but was eventually forced to drop its plans after failing to find a buyer willing to pay the asking price. It then began an extensive expansion programme in Eastern Europe.
The company owns 185 supermarkets in Lithuania, 80 in Latvia and one in Estonia. It had over 18,000 employees last year. It accounts for more than 30% of the Lithuanian market and slightly more than 20% of the Latvian market.
VP Market entered the Ukrainian market early this year, after years of hailing the tremendous potential of the former Soviet countries. However it eventually chose to send a team to Warsaw and launch stores in Poland. VP Market is also about to open stores in Slovakia.
It got a 35 million-euro loan from the European Bank for Reconstruction and Development two months ago.
stelian.negrea@zf.ro ; ionut.bonoiu@zf.ro
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