Delhaize 'Le Lion' Group (Belgium) and Salim Group (Indonesia) have signed a long term cooperation agreement to develop a large supermarket chain in Indonesia.
Following this agreement, Delhaize 'le lion' will provide technical assistance and allow Salim Group to use Delhaize 'Le Lion''s logo under a Technical Assistance Agreement and Trade Mark License Agreement.
Salim Group owns 10 supermarkets of which 7 in Jakarta, 2 in Bandung and 1 in Surabaya which will be named 'Super Indo' and which are integrated in a company named P.T. 'Lion Super Indo'. It is the intention of Salim Group to further develop its supermarket chain in Indonesia since this country has a substantial and increasing potency. For that purpose the assistance from Delhaize 'Le Lion' which possesses the know-how and expertise of world class supermarket business is required.
Indonesia is the fourth most populated country in the world with more than 190 million inhabitants of which 10 million live in Jakarta. The country has been developing very quickly with Gross Domestic Product ('GDP') growth reaching 7 to 8% annually in recent years. Thanks to this rapid growth, purchasing power has increased dramatically as well as the number of potential customers.
The Belgian retail group, Delhaize 'Le Lion', has more than 1,700 sales outlets in 5 countries, Belgium, France, Greece, the Czech Republic and the United States where its largest affiliated company 'Food Lion', operates 1,200 supermarkets. In 1996 the consolidated Delhaize 'Le Lion' turnover achieved a record of USD 13.3 billion. Over 100,000 staff members in the United States and in Europe contribute to the success of the Group's 14 trade names.
Delhaize 'Le Lion' strategy is to concentrate on its core business, food retailing, to develop the group through alliances and/or cooperation with local partners and to favor the long term growth. The agreement with Salim Group fully fits with this strategy. Besides its expansion in Europe and North-America, Delhaize 'Le Lion' Group was seeking to enter into a third pole of development in the fast growing Asian Pacific Region.
Salim Group is the largest privately controlled business group in Indonesia. The Group has investments in many different companies, mainly in Indonesia but also in other countries such as Thailand, the Philippines, Honk Kong, Singapore, China, Vietnam, North America, Europe and Australia. The group employs about 200,000 people all over the world and achieved a turnover of about USD 15 billion in 1996. Salim Group has a substantial presence in several major consumer driven industries in Indonesia including instant noodles, dairy products, flour milling, cooking oil, automobile assembly, property, banking and insurance, retailing and distribution, and in material suppliers, such as cement, palm oil, plantation, plywood and coal. Outside Indonesia, the Salim Group has established interests in telecommunications, banking, real estate, marketing and distribution.
This second agreement follows the announcement yesterday regarding the beginning of a partnership of Delhaize 'Le Lion' in Thailand with The Mall group and Saha group, and is in line with Delhaize 'Le Lion' strategy to develop a strong presence in Asia.
June 24, 1997