OREANDA-NEWS. On 26 March 2008 X5 Retail Group N.V., Russia's largest food retailer in terms of sales, announced that it has signed an agreement to acquire 100% of the business and assets of Kama Retail company – a Pyaterochka franchisee in the Perm region, for a total consideration of approximately USD \\$18 million, including debt. The Company plans to close the deal in April 2008.

As part of the agreement, X5 Group will acquire a total of 28 soft discount stores in Perm and the Perm region with a selling area of 9.3 thousand sq.m. The total area of purchased stores is 19.9 thousand sq.m, out of which 1.9* thousand sq.m. are wholly owned. Net revenue of Kama-Retail for 2007 exceeded USD 50 million.

Lev Khasis, X5 Retail Group CEO, commented:

“The Perm region is an important part of X5’s regional expansion plan for 2008 and will allow us to expand the Group’s presence in Urals by adding to its existing discounter chains in Yekaterinburg and Chelyabinsk. Acquiring Kama Retail, an established Pyaterochka franchisee, provides X5 with an excellent opportunity to secure a strong position in the new region from the very beginning, creating a solid platform for future organic growth”.

Andrei Gusev, Mergers, Acquisitions and Business Development Director at X5 Retail Group added:

“This is a second deal in execution of the Group’s tactics of selective franchisee buy-out in strategically important regions. Based on our success with the first deal in April 2007 when 40 discount stores in Chelyabinsk were bought-out, we expect that this transaction will also result in seamless integration and quick improvement of stores’ performance both in terms of sales density and efficiency.”