X5 Retail Group given go-ahead to buy Karusel

The Federal Anti-Monopoly Service has given the green light to X5 Retail Group N.V. to acquire rights to determine the terms of business for Rusel (the Karusel retail chain trademark).

 The antitrust watchdog has fully
approved the acquisition of Karusel by Russia's largest food
retailer. However, the regulator noted in the decision that such a
deal could eventually harm competition. Therefore, it required that
X5 Retail Group N.V. should not limit competition in St. Petersburg
and take steps to foster it.

The X5 Retail Group N.V, with a market
value of US$6.4 billion, was created in May 2006 when the Pyaterochka
chain of soft discounters merged with Perekrestok. Perekrestok
operates three formats: convenience stores (with an average trading
area of 400 to 600 square meters and 7,500 SKUs), supermarkets (800
to 1,600 square meters with 20,000 SKUs) and city hypermarkets. As of
30 September 2007, the group had 749 stores company-managed stores
and 627 franchisee operated stores across Russia and Kazakhstan.

Since its inception X5 has bought out a
number of retail chains. Last year it acquired smaller grocery chain
Korzinka for US$115 million with 22 stores in the Lipetsk region.
Last month, it signed an agreement to acquire 29 discounter stores
under the Strana Gerkulesia (“Land of Hercules”) brand.

The policy to accelerate growth
continues. X5 Retail Group's results published today show that in
2007 net retail sales surged 53% year-on-year to US$5,284 mln.

"This year we plan to accelerate
gaining exposure to the hypermarket format by opening six compact and
two large size hypermarkets. As a result, we expect to deliver a net
sales increase in the range of 36-38 per cent, exluding currency
effect in 2008,” said Lev Khasis, X5 Retail Group CEO.