Netto chain bought over by grocery giant Asda
Published 28/05/2010 | 10:30
Supermarket giant Asda said yesterday it was snapping up the UK arm of discount retailer Netto, in a move set to add another 193 stores to its estate.
Asda — which is owned by US group Wal-Mart — has agreed a £778m deal to buy the stores, which it aims to convert to the Asda brand by next summer.
The group said it hopes to complete the takeover later this summer, subject to regulatory approval.
The deal marks an ambitious first move by new Asda boss Andy Clarke, who took over the reins earlier this month.
Netto — owned by Danish group Dansk Supermarked — employs 3,500 staff in the UK, having launched on these shores in 1990. The average size of its stores is 8,000 square feet.
Supermarket share figures this week revealed Netto had a 0.7% share of the grocery sector, but the discounters have seen previous stellar growth levels grind to a halt since the end of the recession.
Claus Juel-Jensen, managing director of Netto, said: “We have substantial opportunities for growth in Scandinavia and northern Europe, and believe that the time has come to focus our efforts on the development of our business in these countries.”
Stephen Deyermond, commercial property agent at Belfast consultancy TDK, said the move could increase the chances of trying out the format in the province, even though there are no Netto stores.
“All the multiples have periodically looked at smaller formats over here, so hopefully once the chain is fully integrated into the ASDA business, this experience will give ASDA the reassurance to roll this smaller format into the Northern Ireland market.”
A spokeswoman for the store said: Asda is committed to expanding our store offer across Northern Ireland, bringing our low prices and excellent customer service to more shoppers.”