We entered the largest market in Latin America, Sao Paulo, with a format that we know will have synergies with the stores that we currently operate in Brazil.”
Matías Videla, general manager of Cencosud.
Cencosud announced that its subsidiary in Brazil signed an agreement with the shareholders of Supermarkets GIGA, for the acquisition of 100% of said company, which translates into the entry of the company linked to the Paulmann group to the largest market in Brazil and South America, “directly with the format that grows the most in that country and is the most resilient to recessive macroeconomic contexts,” he said in a statement this Friday.
According to the information provided by the retail firm, both parties closed the deal for 500 million reais, that is, close to 100 million dollars, and it may be adjusted based on the existing working capital in GIGA on the date on which it is agreed. make the transaction effective.
Matías Videla, general manager of Cencosud, expressed the company’s enthusiasm “to be able to enter the largest market in Latin America such as Sao Paulo, with a format that we know will have synergies with the stores that we currently operate in Brazil.” And he highlighted the positioning of the acquired supermarket in said country: “GIGA is a highly valued brand in Sao Paulo, with high growth potential and with a local administration that has demonstrated a successful execution of this format,” he said.
For his part, Sebastián Los, general manager of Cencosud Brasil, pointed out that “this transaction is a milestone for our operation in Brazil. We firmly believe that Giga will empower us with the right format, in a state full of opportunities. This is the beginning of a new stage of growth, which our great team at Cencosud Brasil will know how to promote.”
Giga is a cash & carry supermarket (wholesale) founded in 2009, with 10 stores located in the Brazilian state of Sao Paulo and has a Distribution Center, as of December 31 it had more than 1,300 employees. The premises have an average of 4,500 m2 and are located near high-traffic avenues. Gross income for the last 12 months to March 2022 reached $1.5 billion reais, that is, 295 million dollars.
For its part, Cencosud reported to the Commission for the Financial Market (CMF) that revenues in the first quarter of the year reached an increase of 20.7% compared to the same period in 2021.
“The increase in revenue for the quarter is driven by gains in market share in Supermarkets, in Chile and Argentina, in addition to increases in supermarket sales in Colombia, due to inflation. The businesses of Shopping Centers, Home Improvement and Department Stores, with double-digit increases in revenue for the period,” the company said in the reasoned analysis.
For its part, the profits of the firm linked to the Paulmann family added a jump of 97.7% when compared to the period January-March 2021.
These numbers come hand in hand with the return of consumers to face-to-face commerce. The company registered almost 26 million visits between January and March, an increase of 39.2% compared to the same period of the previous year. Tenant sales also grew by 20.9 percent. “The new convenience and Cash & Carry formats have also shown dynamism and are a source of sales growth, both in Peru and Brazil.”