European online retail by the numbers

By Cross-Atlantic Insight | Publication date: 11/10/2010 | Category: News

The latest report into business-to-consumer ecommerce in Eastern Europe by Hamburg-based market research firm yStats, shows that almost all markets are experiencing strong growth.

Russia was a particularly strong segment, with a growth of 30 percent predicted for all online retail activities in 2010. In Poland, 25 percent of all consumers shopped online in 2009, while revenue generated from online retail accounted for €3.2 billion (£2.80 billion, $4.46 billion). In 2010, yStats predicts an 18 percent growth in Poland, “largely attributed to online auction platforms” and highlights the takeover of polish etailer Merlin.pl by its competitor Empik.com, which is set to establish a Polish equivalent to Amazon. The report also says that Slovakian etailers can expect strong ecommerce growth in 2010, with a predicted rise of 25 percent.

Online shopping was also gathering momentum in the Baltic states. Forty-eight percent of all internet users in Latvia shopped online in 2009, and in neighbouring Lithuania, that figure was 56 percent—up from just 7 percent in 2006. In Hungary, meanwhile, 30 percent of the population still deems online shopping “too risky”.

YStats also noted that in Albania and the former Yugoslav countries of Bosnia-Herzegovina, Croatia, Montenegro and Serbia, few people made online purchases, though shopping online is slowly gaining in popularity.

The international retailer Wal-Mart has reportedly undertaken a second due diligence in regards to the potential acquisition of the Russian Kopeyka retailer and resumed talks with owner Nikolay Tsvetkov. Kopeyka will likely use this opportunity to increase the sales price. Most probably, for this very reason, the company abandoned the idea of an IPO this year.

In a conversation with Retail Update Russia, Retail Solutions General Director Art Vartanian said the postponement of Kopeyka’s IPO was most probably connected with the reported second due diligence. He added that Kopeyka can conduct an IPO at any time in the future, but an offer from such a large retailer as Wal-Mart is rare. Therefore, Kopeyka may test the situation in hopes to receive a better price, although valuations are already quite high, he said.

Wal-Mart announced its interest in Kopeyka in late 2009. However, the companies failed to agree on a price this June and abandoned their talks.

Previously, Russia’s largest retailer, X5 Retail Group, came close to acquiring Kopeyka. The company appealed to the Russian Federal Antimonopoly Service (FAS) to approve the deal in late July, which was estimated at $1.6-1.8m at the time. X5 was permitted to acquire a part of Kopeyka’s assets in September (i.e. Kopeyka Development, Proviant and the Develop Group, which manages Kopeyka’s real estate) and nearly reached a deal. However, Kopeyka recently announced that the company is refraining from making any sales declarations, reportedly due to Wal-Mart’s aforementioned second diligence.

http://www.russiaretail.com

Russian retailer Dixy Group reported revenue rose 17.1% on the year to RUB46.41 billion (USD1.5 billion) from January to end-September. The Moscow-based retailer had 595 stores as of 30 September under the Dixy, Megamart, Minimart, and V-Mart brands. In 2009, the company’s revenue was at RUB54.2 billion (USD1.75 billion), up 12% on the year.

www.retail.ru

Russian grocery retailer O’Key has reportedly seen the order book for its London IPO oversubscribed. Demand for the shares is high, with most of the interest coming from foreign investors. The order book will close on 1 November. O’Key could raise up to USD491 million after pricing its offering at USD9.9 to USD12.9 a share, valuing the company at up to USD3.26 billion.

www.planetretail.net