X5 Group disrupts the “Bunch” – Kommersant

The largest federal retailers continue to strengthen their positions in the regions at the expense of local market players. Thus, X5 Group may transfer the rights to lease part of the stores of the Grozd chain, which manages more than 150 outlets in the Volga region. According to experts, regional chains continue to face pressure due to price competition and difficulties in replenishing the assortment. While the federal players, through mergers and acquisitions, occupy favorable locations for their stores.

X5 Group (manages the Pyaterochka, Perekrestok, Chizhik networks) is considering the possibility of occupying the areas of the Grozd grocery chain, which manages stores in a number of cities in the Volga region, two sources told Kommersant in the retail market and an interlocutor of Kommersant among suppliers . According to one of them, we are talking about renting only part of the Grozdi outlets. The X5 Group did not provide comments, the Grozd network did not respond to Kommersant’s request.

According to Yandex Maps, today there are about 160 stores operating under the Grozd sign, most of which are located in Saratov and Engels. The other day, local media reported on the closure of a number of chain stores in the Saratov region.

In the case of acquiring the lease rights for part of Grozd stores, X5 Group will be able to occupy attractive locations in the cities of the Volga region, and integrate retail outlets into its Pyaterochka or Chizhik chains, Mikhail Burmistrov, CEO of Infoline-Analytics, believes. In 2019, X5 Group similarly expanded its presence in the Saratov region by buying out the leasehold rights to part of the Semeyny chain stores, where Pyaterochka was then opened (see Kommersant dated April 24, 2019).

In general, in 2022, X5 Group showed the highest M&A activity among Russian retail chains, Aton analysts noted earlier. Last summer, the group bought out the Finnish supermarket chain Prisma in St. Petersburg, in November – controlling stakes in the Siberian chains “Slata” and “Krasny Yar”. Also in April 2023, X5 Group acquired the Tamerlan company, which manages the Pakupochka, PukupAlko and Ga-Ga networks in the south of the country. M&A transactions also do not exclude Magnit and Lenta.

At the same time, during the crisis, many regional retailers are forced to close unprofitable facilities and are interested in selling their business or entering into partnerships with federal players, Mr. Burmistrov notes. According to the expert, local retailers are under pressure due to the continued increase in price competition, especially with hard discounters, as well as reduced traffic and the lack of growth in the average check against the backdrop of consumer savings.

In addition, regional networks have fewer opportunities for development, says One Story partner Olga Sumishevskaya. According to her, in today’s conditions they have less funds for investments, including in IT solutions, restoration of supply chains and maintaining the usual assortment on store shelves.

Analysts of Aton believe that the prerequisites for strengthening large networks remain, including through the acquisition of regional players during the crisis. At the same time, Ms. Sumishevskaya notes, each federal retailer may have its own priority regions for expansion, depending on the market share it occupies in a given territory. According to antitrust restrictions, retailers cannot exceed a share of 25% within the same region.

Alina Savitskaya, Anatoly Kostyrev