MOSCOW (Reuters) -Russian supermarket chain Lenta on Tuesday said it had acquired the Monetka chain of 2,120 convenience stores for an undisclosed sum in a deal financed by cash and debt.
Shoppers have faced surging prices and falling incomes since the Kremlin ordered tens of thousands of troops into Ukraine in February 2022, hitting spending power and boosting demand for cut-price goods.
The Kommersant daily in July quoted a market expert as valuing a possible Lenta purchase at 60 billion to 70 billion roubles ($616.9-$719.7 million). A person familiar with the deal on Tuesday told Reuters that estimate was close to the actual figure.
Monetka has around 23,000 employees and operates mostly in the Urals and Western Siberia, strengthening Lenta's position there. Lenta said the Monetka brand would live on and that some of its Mini Lenta stores would be rebranded as Monetka.
The transaction was approved by the Lenta board of directors and Russia's Federal Anti-Monopoly Service (FAS), Lenta said.
"An ambitious but achievable task now stands before us - integrating the assets of two of the leading grocery chains in the country," Lenta CEO Vladimir Sorokin said in a statement.
This would involve combining the two chains' best practices and then integrating logistics, IT and operating systems, Sorokin said.
Lenta rivals X5, Magnit and O'Key have all hailed the importance of discount stores in their strategies in the past year.
Lenta said the Monetka acquisition would help it to realise strategic plans to achieve revenue of 1 trillion roubles by 2025.
($1 = 97.2650 roubles)