M.Video to buy retail chain Eldorado from Safmar for 45.5 bln rbl
MOSCOW, Mar 22 (PRIME) -- RussiaТs home appliances retailer M.Video will buy retail chain Eldorado from their parent company Safmar for 45.5 billion rubles excluding EldoradoТs liabilities, M.Video said in a statement on Thursday.
M.Video will take out a 40 billion ruble loan and use its own funds to finance the purchase. The merged companyТs loan portfolio will rise to 47 billion rubles.
M.Video plans to maintain both brands after the merger and to raise their combined revenue to 450 billion rubles by 2022. The synergy effect of the merger is anticipated at up to 18 billion rubles in EBITDA terms in 2018Ц2020 and the aggregate EBITDA and net profit figures may double within five years.
The merged companyТs net debt to earnings before interest, taxes, depreciation, and amortization (EBITDA) ratio is expected to amount to 1.5x by the end of 2018.
The management team headed by M.Video founder and President Alexander Tynkovan and CEO Enrique Fernandez will manage the merged company.
The decision is yet to be approved by shareholders at an extraordinary general meeting.
Safmar bought a 57.7% stake in M.Video in 2017 and acquired Eldorado in 2016.
(57.4954 rubles Ц U.S. $1)