Tuesday 22nd December 2020
Cartel office clears deal
Kaufland is allowed to take over Real markets
The Russian owner SCP smashes the department store chain Real and sells the branches to the competition. Kaufland secured a large part of the portfolio with 92 houses. The deal has now also received approval from the Federal Cartel Office.
The Federal Cartel Office has cleared the way for the breaking up of the ailing hypermarket chain Real. The large-scale discounter Kaufland received the green light from the competition authority to take over up to 92 Real stores. The supermarket chain Globus received approval for the acquisition of up to 24 Real locations, as announced by the competition authority.
For Kaufland, it is the largest takeover in the company's history to date. The company has so far operated 670 hypermarkets nationwide and, like Lidl, belongs to the Schwarz Group, the largest food retailer in Europe. Originally Kaufland had even wanted to take over up to 101 Real branches. But in 9 markets the competition watchdogs were cross.
Bundeskartellamt President Andreas Mundt emphasized: "We want consumers to have enough choice between different grocery stores where they shop. That is why we are only allowing Kaufland to take over up to 92 Real locations instead of the 101 registered ones." In the cases in which the Cartel Office did not cooperate, the competition authorities believe that the alternatives and competition would have been too severely impaired.
The takeover of up to 24 Real locations by Globus, on the other hand, is unproblematic according to the competition watchdog. With 47 hypermarkets in Germany, Globus only has a turnover of 4.5 billion euros. However, the Federal Cartel Office examined not only the effects of the takeovers on consumers, but also the effects on the procurement side, where the dealers and their suppliers face each other.
Kaufland promises employees prospects
Mundt emphasized that the Schwarz Group with Kaufland and Lidl was expanding its strong market position in purchasing through the takeovers. However, the release was still possible because Real owner SCP committed in return to sell a significant number of Real locations to medium-sized grocery retailers. This means that there is still an important sales alternative for manufacturers and suppliers of food in Germany. "After the course of the sale process, it could not be assumed that medium-sized dealers would have been able to acquire locations without the influence of the Federal Cartel Office", emphasized Mundt.
Kaufland wants to take over the Real stores step by step from the first quarter of 2021. "In the coming months we will integrate the markets and maintain them as regional local suppliers for customers," said the head of Kaufland Germany, Ralf Imhof. This gave up to 12,000 employees a new professional perspective.
The Russian Real owner SCP had acquired the ailing hypermarket chain with its around 270 stores from Metro in the spring in order to break up and sell it. In addition to Kaufland and Globus, Germany's largest grocery retailer Edeka has also registered with the Federal Cartel Office to take over up to 72 Real branches. But the decision of the competition watchdog is still pending. The deadline for a decision was recently extended to February 22, 2021.
In Germany, the four leading retail chains Edeka, Rewe, Aldi and the Schwarz Group account for more than 85 percent of sales in the food trade. That is why the Bundeskartellamt is particularly vigilant when it comes to takeovers in this area.
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