Mid Europa Partners, a private equity firm focused on Central and South Eastern Europe, is to acquire 100 per cent of shares in Profi Rom Food, the largest supermarket chain in Romania, from Polish Enterprise Fund VI.
This is the largest deal ever completed by a private equity firm in Romania and the largest retail deal in the country’s history. The transaction is subject to anti-trust clearance and is expected to close in Q1 2017.
Profi is a modern retail network with the widest geographical spread in Romania, having a strong presence in almost 250 cities, smaller towns and villages. Profi operates two store formats in urban areas, Standard and City, and recently developed Loco, a successful format for rural parts of the country. In aggregate, it operates from almost 500 stores and will have sales of around EUR800 million in 2016. It is the first retail chain in Romania to have created a brand dedicated to rural customers and aimed at reaching regions previously unavailable to modern retail.
Profi is one of the top employers in Romania, with nearly 11,000 employees.
Nikolaus Bethlen, partner of Mid Europa, says: "Profi is the fastest growing food retail operator in Romania and is ideally positioned to build on its leadership position to deliver organic growth in the future. We have closely followed Profi’s development over the last few years and are excited to have the opportunity to work together with management to continue Profi’s success story. The acquisition of Profi underscores our commitment to Romania and is the second landmark transaction in the country after our acquisition of Regina Maria last year."
“Profi has a proven track record of gaining new customers by offering fresh products in modern proximity stores around the country. The company is in excellent shape and has great potential to grow in the years to come, as Romania has many more areas to take modern retail to. We look forward to working with the new owners and believe that the Company will greatly benefit from Mid Europa’s success in food retail in Poland with their Zabka investment,” says Daniel Cirstea, CEO of Profi Rom Food.
Robert Knorr, co-managing partner and head of the retail and consumer practice at Mid Europa, says: “The acquisition of Profi demonstrates the firm’s continued focus on attractive retail opportunities in our region. Mid Europa has a strong track record of building true national champions. In 2011, the firm invested in Zabka Polska and developed it into the leading convenience retail operator in Poland. More recently Mid Europa, together with Cinven and Permira, announced the acquisition of Allegro, the leading on- line retailer in Poland.”
Advisers to Mid Europa Partners on the transaction were Beragua (commercial), EY (financial), Dechert and Bondoc & Asociatii (legal).