In a significant development for the European retail landscape, Ahold Delhaize has officially completed its acquisition of Romanian grocery retailer Profi Rom Food SRL (Profi) from MidEuropa for an enterprise value of approximately €1.3 billion (US $1.34 billion). This strategic move effectively doubles Ahold Delhaize’s existing retail footprint in Romania, where the company operates nearly 1,000 stores under the Mega Image banner.
Enhancing Reach and Service
Frans Muller, President and CEO of Ahold Delhaize, emphasized the positive impact of this acquisition on their operational capabilities in both urban and rural areas of Romania. “The complementary strengths of Profi and Mega Image will bolster our ability to serve customers, spur growth, and offer a wider variety of choices and value to Romanian shoppers,” he stated. With the integration of Profi, customers in Romania can expect an enriched shopping experience.
Claude Sarrailh, CEO of Ahold Delhaize Europe and Indonesia, added that the acquisition reflects their commitment to expanding high-quality product offerings in Romania. He expressed pride in welcoming Profi into the family of brands, highlighting its potential for growth within the Central and Southeastern European markets.
Profi has built a strong reputation for providing a diverse product assortment and great value for its customers. It operates approximately 1,700 supermarkets and convenience stores across Romania and generated €2.7 billion (US $2.8 billion) in net sales in the year ending June 2024. Ahold Delhaize anticipates that Profi will contribute an estimated €3 billion (US $3.1 billion) in net sales to its financial results in 2025.
Strategic Synergies and Market Adaptation
The merger will allow both Mega Image and Profi to leverage their unique strengths while achieving operational synergies. Mircea Moga, President of Mega Image, expressed excitement about collaborating with Profi: “The combination between our two brands will complement and expand Ahold Delhaize’s existing Romanian footprint. We are enthusiastic about the opportunities this partnership brings.”
This merger could provide a competitive advantage to both brands by streamlining operations, enhancing supply chain efficiencies, and maximizing product offerings tailored to the preferences of Romanian shoppers. As the retail landscape continues to evolve, the combination of resources and expertise will facilitate better service delivery and innovation.
Challenges Ahead: Regulatory Compliance and Integration
As with any significant acquisition, regulatory hurdles were part of the process. The Romanian Competition Council approved the transaction but imposed obligations regarding supplier relationships and dictated the divestment of 87 stores to maintain competition in the furtherance of the acquisition’s approval. The successful navigation of these challenges will be crucial for Ahold Delhaize’s smooth transition into integrating Profi’s operations.
Moreover, Ahold Delhaize is expected to establish a new technology studio in Bucharest, known as AD/01, which will foster innovations for enhancing customer experiences across its European brands. This studio aims to employ around 250 people and represents a commitment to investing in technology to stay at the forefront of the market.
Ahold Delhaize in the Global Context
Ahold Delhaize, headquartered in Zaandam, Netherlands, caters to 63 million customers each week, spanning the United States, Europe, and Indonesia. With over 400,000 employees across 7,716 grocery and specialty stores, it stands as a prominent player in the global retail arena. The company employs various strategies to adapt to market trends while focusing on sustainability and customer satisfaction.
Boasting a robust portfolio of renowned brands including Food Lion, Giant Food, and Stop & Shop, Ahold Delhaize has been recognized as one of the top food and consumables retailers in North America, ranking 11th on The PG 100 for 2024. Additionally, it has received accolades as one of the “Retailers of the Century” and one of the “10 Most Sustainable Grocers.”
Conclusion
The acquisition of Profi signifies more than just a numerical increase in store count for Ahold Delhaize; it represents a step towards enhancing market presence and responding more effectively to consumer needs within the Romanian landscape. As the retail sector faces ongoing challenges from e-commerce and shifting consumer habits, this strategic acquisition is poised to strengthen Ahold Delhaize’s competitive edge while positioning it for long-term growth in Central and Southeastern Europe.
