English news : 22 october 2007
22 October 2007
WAL-MART to make Seiyu wholly owned subsidiary
Wal-Mart has announced this morning it will launch a tender offer to acquire all of the issued and outstanding shares of its Japanese subsidiary, Seiyu, that it does not already own. The offer is being made with the endorsement of the Seiyu Board of Directors, which has passed a resolution of support. The tender offer price is JPY140 (USD1.14) per common share. This represents a premium of 60.9% over the closing price on the Tokyo Stock Exchange on October 19, and a premium of 34.6% over the average closing price for the prior three months. Wal-Mart currently owns 50.9% of Seiyu. The tender offer represents an additional investment by Wal-Mart of up to JPY100 billion (approximately USD862 million). "(This) announcement is a reaffirmation of our commitment to Japan, the second largest economy in the world," said Mike Duke, Vice Chairman of Wal-Mart. "The Japanese retail market is of major strategic importance to Wal-Mart, and our goal is to achieve long-term success and growth in Japan. Full ownership by Wal-Mart is the best way for Seiyu and Wal-Mart to accelerate the delivery of long-term benefits to our customers, the communities we serve, our associates and our business partners."
The tender offer will commence tomorrow and will be open for 30 business days, closing on December 4, 2007. Wal-Mart's minimum objective through the tender offer is to achieve ownership of at least two thirds of Seiyu's common shares. Following a successful tender offer, Wal-Mart intends to take additional steps to acquire all of the remaining shares, which would result in the delisting of Seiyu shares from the Tokyo Stock Exchange. Seiyu and Wal-Mart entered into an alliance in May 2002. Wal-Mart became the majority owner of Seiyu at the end of 2005, and has since committed substantial resources with the aim of improving Seiyu's corporate value. Both Seiyu and Wal-Mart now believe that it is in both companies' best interests for Seiyu to become a wholly-owned subsidiary of Wal-Mart, to ensure that Seiyu can benefit most fully from Wal-Mart's support.
"As a wholly-owned subsidiary, Seiyu will have increased flexibility to invest in merchandising, store renovation, distribution and logistics," said Duke. "Our Japanese associates will benefit from these steps to enhance the company's performance. In addition, this provides reassurance to our business partners and increases confidence in Seiyu's strength and future prospects."
According to reports in the Norwegian press, c-store chain 7-Eleven (operated under licence by Reitan) has opened a new store concept in Tåsen, Oslo. The store places a much greater emphasis on serving meals and includes a new coffee bar from Rosso. Several sections have products on wheels so these can be moved during the day, allowing breakfast products to be on show in the morning and lunch products at midday.
ALDI offers real estate for sale in Germany
Aldi Nord has for the first time offered a bundle of real estate comprising 200 outlets in Germany, worth an estimated EUR400 million (USD537 million). As reported by Lebensmittel Zeitung, this is around 8% of Aldi Nord's store network in Germany. Through this move, Aldi follows the example of its competitor Lidl, which recently sold two real estate packages at around EUR1.2 billion (USD1.6 billion) to finance its expansion. Aldi has so far pursued the strategy of owning its retail premises wherever possible.
In the UK, Asda has augmented its online offer through the launch of a new 'gifts' microsite at www.asda-gifts.co.uk. The site offers an array of products and experiences grouped into categories such as Driving Experiences, Pampering Days, Adrenaline Zone, For Him and For Her. The new site offers over 1,000 gift ideas, with Asda acting as an agent for selected operators and providers. The gifts include once in a lifetime experiences such as Ferrari and tank driving to the more relaxing spa breaks and balloon flights. Wherever possible Asda Gifts will sell experiences at the same price consumers would pay if they went direct to the suppliers. Asda states that "We are able to do this as we provide our suppliers with large volumes of customers and in return they provide us with competitive discounts. We are so confident in our pricing levels that we even offer a 150% money back guarantee on every experience we sell." The Asda Gifts site is run and fulfilled by Buyagift Ltd.
According to reports in the Italian press, Auchan owned SMA has signed a strategic ten year agreement with Crai (an association of independent retailers) to combine purchasing, logistics and service activities from 1 January next year. The deal will see Crai join SMA in the Intermedia purchasing group, and Crai Distribution will be able to develop a network of stores using the banner names of SMA.
CARREFOUR takes part in European RFID project
As reported by Lebensmittel Zeitung, Carrefour is taking part in the EuropeanUnion-fundedBridge project which aims to develop and promote RFID technology. Carrefour has announced that it is working on four RFID pilot projects involving the consumer electronics, entertainment and clothing categories. As part of the scheme, RFID tags are used at the pallet, cardboard and product levels while the transport processes from manufacturer to distribution centre, and from distribution centre to store, is analysed as well. According to project manager Pierre Blanc, "We focus on the processes and support our operative units in the implementation process". According to Mr Blanc, the company has achieved "significant improvements in terms of time and data quality" in its tests, with the supply process accelerated by 50% and the time needed for stock taking reduced by almost 80%, with greater staff satisfaction achieved on top. From 2008, Carrefour plans to have the entire range from a clothing supplier in Asia RFID tagged for the Belgium market, with the tagging process of the 1 million articles due to be carried out directly at the Asian manufacturing plant.
CP SEVEN ELEVEN changes name
Over the weekend, CP Seven Eleven in Thailand announced a change of name to CP All. The change is to support other related businesses besides its core 7-Eleven convenience-store business. Chief executive officer Korsak Chairasmisak said the board decided to make the change because it wanted to differentiate the company's name from the trademark of its convenience stores. The company is also planning to expand its convenience stores in Vietnam. Mr Chairasmisak said Vietnam has strong potential for this business because it has more than 70 million people and its gross domestic product is rapidly growing. However, the operator of 7-Eleven in Hong Kong, Dairy Farm, is also interested in opening convenience stores in Vietnam. "It depends on our parent company Seven Eleven in the United States to choose who is more suitable to operate in Vietnam," according to Mr Chairasmisak. "However, we believe that we are more favoured thanks to our excellent operating results and the country's location." The decision is expected to be finalised by the middle of next year.
In the USA, Dollar Tree has reported that Kent Kleeberger has resigned his position as Chief Financial Officer in order to pursue other career opportunities. The company has begun the process to identify a highly qualified CFO to replace Mr. Kleeberger and announced that plans for an orderly transition are in place. "It has been a pleasure to work with everyone at Dollar Tree and to have been a part of the success of a great organisation that has produced industry leading financial results while setting high standards for integrity and fairness," Mr. Kleeberger said. "I am especially proud of the Finance team and our accomplishments over the past three years. My decision to leave is based entirely upon my personal goals and the needs of my family. Dollar Tree has exciting plans for the future, a history of solid execution and I wish them continued success."
EDEKA launches premium fruit & veg private label line
In Germany, Edeka is launching a premium private label range of fruit & vegetables. The brand 'Yacaran' is supplemented by the umbrella name 'Edeka Selection' and supported by the claim 'Erlebnis für die Sinne' (experience for your senses). Independent Edeka retailers will be supplied by extra ceiling banners, shelf signs and leaflets featuring the premium range. "Studies have shown that for fruit, 74%, and for vegetables, 66% are bought as impulse purchases," Edeka states in an information brochure targeted at its independents. The products will be delivered in specially designed Yacaran cardboard boxes.
Spanish retailer El Corte Inglés has announced that it is going to implement SAP Retail in order to better integrate all back office systems and further expand its ecommerce potential.
LECLERC to launch into mobile phones
In France, Leclerc has concluded a partnership deal with mobile telephone operator Afone to launch its own MVNO phone service.
Lidl is to start construction work on its seventh distribution centre in Spain shortly. The discount retailer has earmarked a sum of EUR28 million (USD37.6 million) in the warehouse to be built in Málaga, zona de Teatinos. The 34,000-square-metre building is expected to go onstream in mid-2009. Lidl runs distribution centres in Sevilla, Pinto (Madrid), Ribarroja y Moncada (Valencia), Llodio (País Vasco) and Nalón (Galicia).
M&S unveils new premium wine range
As reported by the trade press, in the UK, Marks & Spencer has launched a fine and premium wine range. The fine wine range will be merchandised on a separate fixture in flagship stores around the country, and will feature wines priced from around GBP15 (USD29.76) to GBP70 (USD138.91). Many of the wines come from small parcels which M&S would not be able to sell in all its stores. Buyer Andy Howard said: "The range contains examples from Australia, New Zealand and Chile, to complement an extensive range of wines from Burgundy, Bordeaux and Italy. It will initially be sold in up to 20 flagship stores from November, the start of a major extension in terms of range and price within M&S wines. The fine wine market is very dynamic and exciting." The internet-exclusive range will come online this week, and includes among other case deals a range of Chablis beyond M&S's store range.
METRO to expand Japanese cash & carry operations
Metro has this morning announced that it plans to invest about EUR160 million (USD214.6 million) to open eight new cash & carry outlets in the Tokyo metropolitan area in Japan over the next two years. Metro Cash & Carry began operations in Japan 2002 and has opened three outlets since then. The retailer did not give specific sales targets but said it was ready to expand after five years gaining an understanding of the market. "We knew that Japan is one of the most sophisticated and competitive markets in retail and wholesale and still is," according to James Scott, Metro Cash & Carry regional operating officer Asia, "Nonetheless, we decided to take a step and to accept this challenge as we are convinced of Japan's great potential for our self-service wholesale business." The retailer said after establishing these stores, it will continue expanding its wholesale business outside of the Tokyo area as well. "We will strive for further expansion of our wholesale business to other regions and urban centres of Japan.”
Underscoring the importance of Halloween for US retailers, drugstore chain Rite Aid has marketed its status as a destination for its customers' Halloween-related shopping requirements. "After Christmas, Halloween is our second biggest sales holiday," said Bryan Shirtliff, SVP of category management for Rite Aid. "Rite Aid has a great assortment of merchandise, guaranteed to help (shoppers) celebrate Halloween in style, including costumes for kids and adults, indoor and outdoor decorations, and of course, candy." Highlights of its seasonal ranges are said to include new costume lines such as tuxedos and cheerleader outfits for cats and dogs; severed hands and legs; and Rising Reaper Tombstones.
According to unconfirmed reports in the Sunday press, the takeover of Sainsbury by Qatari backed investment fund Delta Two has been thrown into question over the weekend over doubts about the financing arrangements. Agreement between Delta Two and the retailer’s pension trustees the only remaining hurdle had been thought to be close and the market was expecting an imminent announcement of an offer. However, no agreement has been reached and talks have stalled, with inside sources suggesting that Delta Two has turned its attention back to its financing, which may not be as secure as previously thought.
GALP to buy ENI’s downstream business in Spain and Portugal
Portuguese oil giant Galp has agreed to buy Eni’s downstream business in Portugal and Spain. Galp, in which Eni has 33.34% stake, decided to exercise an option for the acquisition of all Eni's downstream activities, except for the lubricants business in the two countries. The value of the deal for the two businesses, known as Agip España and Agip Portugal, will be defined by three investment banks to be chosen by Galp and Eni. However, the transaction will still be subject to the authorisation of local authorities.
In the USA, Sheetz has announced the promotion of two veteran executives to the level of executive vice president. Mike Lorenz, vice president of petroleum supply, has been elevated to executive vice president of petroleum supply while Ray Ryan, vice president of distribution services, has been promoted to executive vice president of distribution and Sheetz Bros. Kitchen. The promotions took effect on October 1. With this advancement, Lorenz and Ryan join the Sheetz Executive Committee, which sets all strategic goals for the company and leads all corporate departments that support store operations. Lorenz joined Sheetz in 2000 as the vice president of petroleum, responsible for purchasing all petroleum products for Sheetz, which totals more than one billion gallons each year. Ryan was integral during the development of the Sheetz Distribution Centre and thus took the role of vice president in 2001. Ryan will also oversee all operations of the new Sheetz Bros. Kitchen, a 13,000 square metre centralised kitchen where food products will be made fresh and shipped daily to all 339 Sheetz locations. Sheetz Bros. Kitchen is expected to be operational in late 2008.
In the USA, Shopko has announced the appointment of Jill Soltau as Senior Vice President, General Merchandise Manager - Softlines. Soltau will report to Michael MacDonald, Shopko Chairman and CEO. Soltau's work experience includes senior merchandising positions with both Sears and Kohl's. Her prior experience was with the Carson Pirie Scott division of Saks where she held a variety of stores and merchandising roles over a nine year period. MacDonald commented, "Jill's depth and breadth of experience make her the ideal candidate for this most important role. Jill's extensive background in buying, product development and planning and allocation, together with her multiple retail channel exposure represents a powerful combination of skills and experience. I am exceptionally pleased to welcome Jill Soltau to the Shopko team."
SHOPPERS DRUG MART unveils further private label products
As part of its burgeoning private label development programme, Shoppers Drug Mart has unveiled another 70 new Life-branded products. SDM has been aggressively pushing into the grocery sector, a strategy that is reflected in its latest PL introductions. Recent Planet Retail visits to SDM stores in Ontario have seen the retailer focus on rolling out the Life brand into food and drink products, with recent developments including the introduction of more SKUs in the Good for Life sub-brand of healthier products and the launch of the Frizzante sub-brand for fruit-flavoured sodas. The new Good for Life products - which boast attributes such as added Omega 3, high fibre, low sodium, low fat and low calorie - include lines such as granola bars, margarine, tinned tuna, peanut butter, canned soups and soft drinks. The Frizzante soda range, meanwhile, comprises new fruit-flavoured drinks imported from France. Other new food and drink lines under the general Life brand include trail mix, biscuits and crackers, honey and herbal teas.
TARGET aims for nationwide coverage
US discounter Target is aiming to open stores in Alaska, Hawaii and Vermont, a company executive said, a move that will put the discount retailer in all 50 United States. Target's Senior Vice President of real estate, Scott Nelson, said in an interview that construction is underway for a Target store in Alaska, and the retailer is trying to find the right location to open a store in Vermont. "Vermont, from a population standpoint, is not a real large state and clearly there is an increased sensitivity to store placement in Vermont," he said. In Hawaii, Target has plans to open a store on the island of Oahu, he said, but it has interest in putting stores on all the major Hawaiian islands. Target will also be opening its first store in Manhattan, having signed a lease for store space in the East RiverPlaza, a new construction project in East Harlem, which is currently slated to open in the spring of 2009.
TESCO loses another senior executive
At Tesco, commercial finance director, Keith Down, announced at the end of last week that he was leaving to become finance director at pub operator JD Wetherspoon. Mr Down's defection follows Thursday's announcement that Julia Reynolds, director of Tesco's central European clothing business, is to leave the retailer to join Figleaves.com. A spokesman for Tesco said "This stuff about a brain-drain is complete nonsense. We've lost some good people but we've also recruited some good people; that's what happens in companies of our size".
WAITROSE unveils private label wine
As reported by the trade press, in the UK, John Lewis owned Waitrose has launched the first ten wines that will make up its new private label range, called In Partnership With. The range has been developed over the past 18 months, with some of the wines rolled out over the summer to test consumer reaction. The bottles all carry a lower label with the wording Waitrose In Partnership With, plus the name and location of the winery. Waitrose's six-strong Solera sherry range has also been repackaged for the Partnership brand. Wine buying manager Justin Howard-Sneyd MW said two Californian wines will be introduced to the range early next year. A further six wines, including Sauternes and Valpolicella, will be added over the next six to nine months, and sparkling wines are also being sourced. The additions will bring the range total to 24.
WAL-MART creates new product development position
Wal-Mart Stores has announced that the executive who led the retailer’s sustainability efforts, Andew Ruben, is to take up a newly created position in product development.. Mr Ruben will oversee Wal-Mart’s private label brands, including Sam’s Choice and Great Value. "Under Andy's leadership, we laid the foundation for a long-term effort that will transform our business by driving out hidden costs, conserving our natural resources for future generations, and providing sustainable and affordable products for our customers so they can save money and live better," Wal-Mart spokesman David Tovar said. In his new position, Ruben will be tasked with making Wal-Mart's private-label products more environmentally friendly. Tovar said the transition will take several weeks. Ruben will be replaced by Matt Kistler, senior vice president of marketing for Sam's Club.
WAL-MART warns websites over price leaks
Wal-Mart Stores has threatened legal action against website owners that leak the retailer’s discounted prices for “Black Friday”, the start of the traditional Xmas shopping season in the USA. Prices in these advertisements are "commercially valuable," and their unauthorized release to the public may result in severe legal penalties, including criminal, according to a letter sent by Wal-Mart counsel Gary J. Rinkerman to Brad Olson, founder of Gottadeal.com. Wal-Mart spokesman John Simley verified the contents of the letter. He declined to identify which websites received them. "It's wrong for them" to post the advertisements, he said. "It's information getting out too early. We have a strategy around the release of this information through these channels."
According to reports in the Australian press, Woolworths is to invest AUD1 billion (USD841.1 million) in its BIG W chain in order to increase its competitive lead. Changes will entail new logo design, slogan, wider aisles in stores and improved merchandising, among others. Further details are expected to be released tomorrow coinciding with Woolworths’ sales results for the September quarter.
German based electronics buying group Expert has announced that its sales in the first half of 2007 increased by more than 12%. Flat panel TVs continued to drive goods and Chief Executive Volker Muller sees no evidence that sales in this product category are slowing down. “The market is still far from saturated, the fascination of the big screen diagonals with pin-sharp images is undiminished,” he said confidently. The company said that it had increased its warehouse space in Germany by 7,000 to 28,500 square metres in the first half of the year.
M.VIDEO announces price range for IPO
The Russian electronics and home appliance retail chain M.Video has announced a preliminary price range for its upcoming IPO at USD6-USD8 per share as M.Video's shareholder Svece plans to sell 52.5 million common shares in the company. Svece intends to use part of the proceeds to acquire up to 30 million additional common shares to be issued by the company later. M.Video's market capitalisation following the IPO is expected to reach between USD1.08 billion and USD1.44 billion, while its free float is anticipated to amount to 30%.
SATURN drops famous advertising slogan
After five years, Metro Group-owned consumer electronics chain Saturn has dropped its famous "Geiz ist geil" ("it's cool to be a tight miser") advertising campaign, as announced by banner director Roland Weise in Frankfurter Allgemeine Sonntagszeitung. Mr Weise said the "zeitgeist" had changed with German consumers moving away from their formerly very strong focus on low prices, but added that "Geiz ist geil" had been the company's most successful advertising slogan ever. According to Mr Weise, Saturn is to spend EUR500 million (USD671 million) on advertising this year, using its new slogan "Wir lieben Technologie. Wir hassen teuer" ("We love technology. We hate expensive").
Fujitsu Transaction Solutions has announced that the three-month installation of AbsoluteSKY’s Radio Frequency Identification (RFID)-based intelliTRACKER product suite in Staples Business Depot’s first store has been successful. AbsoluteSKY’s real-time, long range inventory tracking system was installed in a 3,440 square metre Staples Business Depot store in May 2007 as a test pilot. To date, roughly 1,500 SKUs have been tagged, and the system has been reporting inventory status and changes on a minute-to-minute basis as merchandise travels from receiving to store shelves, across retailer-defined zones and through the point-of-sale process. The results achieved illustrate a fully automated and highly accurate business system for item-level inventory tracking. “The clear and measurable gains we experienced with intelliTRACKER have exceeded our expectations,” said Joe Soares, director, process engineering at Staples Business Depot. “The system was easy to install and has consistently delivered inventory visibility with 100 percent accuracy since we went live.”
THE PHONE HOUSE joins with Neuf Cegetel to update its business telecom solution
Neuf Cegetel will be equipping The Phone House stores throughout France with its 9pass small-business telecom solution. A total of 290 sites will be connected to the Neuf Cegetel network and fitted with a Neuf-Cegetel-designed box combining modem, router, firewall and IPBX functions, to provide access to voice and data services for fixed and mobile sets. The contract fits in with a broad programme for migrating the company's communication system to internet protocol. Tests have begun at pilot sites in the Paris region, and nationwide rollout will proceed through till early 2008. The 9pass solution is easy to install and provides smooth transition to IP telephony with a significant reduction in overall telecommunication costs. It relies on full unbundling; main features include unlimited national and international calls, an enterprise IPBX with built-in WiFi, broadband Internet services, and business email based on Microsoft technology. Additional data storage, roaming, mobility and security options are also available.