BRUSSELS, Belgium, March 31, 2008 - Delhaize Group (Euronext Brussels: DELB - NYSE: DEG), the Belgian international food retailer, announced today that it has entered into an agreement to acquire La Fourmi, which operates 14 supermarkets in Bucharest, through its fully-owned subsidiary Mega Image. This highly complementary acquisition allows Mega Image to strengthen its leading position in Bucharest, the capital of Romania.
John Kyritsis, General Manager of Mega Image, commented: “This transaction fits perfectly into Mega Image’s strategy of growing via well-located stores in urban areas. The 14 La Fourmi stores will strengthen our store network. We also expect sizable sales opportunities and buying synergies from this acquisition.”
In 2005, Global Finance, a Greek private equity fund, took an 80% stake in La Fourmi. This stake was then further raised to the level of approximately 90%. The remaining 10% belonged to private investors. The purchase price for 100% ownership of La Fourmi is EUR 18.6 million, subject to contractual adjustments. The acquisition includes real estate ownership of four stores.
La Fourmi was the first supermarket chain to open in Bucharest in 1992. For 2007, it is estimated that the revenues of the 14 acquired stores amount to approximately EUR 30 million. The 14 stores, which have a size of 350 to 500 square meters, will be converted to Mega Image supermarkets. Thanks to the proximity of the acquired stores within Bucharest, Mega Image’s existing distribution center will be used to serve those stores.
Renaud Cogels, Chief Executive Officer of Delhaize Group Southeastern Europe said: “With this acquisition, as well as with the acquisition of Plus Hellas in Greece in January, Delhaize Group shows its commitment to reinforce its presence in the Balkans. The acquisition of these 14 stores gives us the opportunity to strengthen our position in Romania and in particular in Bucharest, a city in rapid expansion.”
The acquisition of La Fourmi is subject to customary conditions, including the approval by the Romanian antitrust authorities. The transaction is expected to close in the second quarter of 2008.
At the end of 2007, Mega Image’s network consisted of 22 stores, 19 in Bucharest, 2 in Constanta and 1 in Ploiesti. The number of employees at the end of 2007 was approximately 1,200 people. Delhaize Group acquired a 51% stake in Mega Image in 2000. In 2004, Mega Image became fully-owned by Delhaize Group.
Delhaize Group
Delhaize Group is a Belgian food retailer with operations in seven countries on three continents. At the end of 2007, Delhaize Group’s sales network consisted of 2,545 stores. In 2007, Delhaize Group’s revenues amounted to EUR 19.0 billion. In 2007, Delhaize Group posted EUR 410.1 million in net profit. At the end of 2007, Delhaize Group employed approximately 138,000 people. Delhaize Group is listed on Euronext Brussels (DELB) and the New York Stock Exchange (DEG).
CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS
Statements that are included or incorporated by reference in this press release and other written and oral statements made from time to time by Delhaize Group and its representatives, other than statements of historical fact, which address activities, events and developments that Delhaize Group expects or anticipates will or may occur in the future, including, without limitation, statements about strategic acquisitions, future strategies and the anticipated benefits of these strategies, are “forward-looking statements” within the meaning of the U.S. federal securities laws that are subject to risks and uncertainties. These forward-looking statements generally can be identified as statements that include phrases such as “guidance”, “outlook”, “projected”, “believe”, “target”, “predict”, “estimate”, “forecast”, “strategy”, “may”, “goal”, “expect”, “anticipate”, “intend”, “plan”, “foresee”, “likely”, “will”, “should” or other similar words or phrases. Although such statements are based on current information, actual outcomes and results may differ materially from those projected depending upon a variety of factors, including, but not limited to, regulatory review of transactions, changes in the general economy or the markets of Delhaize Group, in consumer spending, in inflation or currency exchange rates or in legislation or regulation; competitive factors; adverse determination with respect to claims; inability to timely develop, remodel, integrate or convert stores; and supply or quality control problems with vendors. Additional risks and uncertainties that could cause actual results to differ materially from those stated or implied by such forward-looking statements are described in Delhaize Group’s Annual Report on Form 20-F for the year ended December 31, 2006 and other periodic filings made by Delhaize Group with the U.S. Securities and Exchange Commission, which risk factors are incorporated herein by reference. Delhaize Group disclaims any obligation to update developments of these risk factors or to announce publicly any revision to any of the forward-looking statements contained in this release, or to make corrections to reflect future events or developments.