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ZAANDAM, The Netherlands -- Ahold will sell its Dutch foodservice wholesale subsidiary, Deli XL, to Bidvest Holding B.V., for 140 million euros as part of a strategic plan to focus on its retail business and reduce debt.
Noting that talks with unions over the transaction have been completed, Ahold, the world's third-largest grocery retailer, says it expects the sale to close in the third quarter, pending regulatory approval.
Bidvest will pay a cash consideration, repay debt to Ahold, and assume the debt of Deli XL, which posted 2004 sales of 819 million euros, or $987.3 million.
"The divestment of Deli XL marks an important step towards finalizing our divestment program," said Ahold president and c.e.o. Anders Moberg. "Our strategy for the Dutch business is targeted on its retail activities. The investment and management attention needed to assume a greater role in European foodservice is inconsistent with this focus. We therefore believe that Deli XL's potential in the out of home food market can better be realized under an owner such as Bidvest. We are confident that this buyer is committed to pursue the further improvement and development of Deli XL and its staff."
Bidvest, with consolidated 2004 sales of 6.7 billion euros, is an international services, trading and distribution company listed on the JSE Securities Exchange South Africa, and operating on three continents. It employs 81,000 people worldwide and has a strong presence in the foodservice industry in the United Kingdom, Australia, New Zealand and South Africa.
Deli XL employs about 2,100 in The Netherlands and Belgium, and currently supplies more than 60,000 products to around 34,000 customers including hospitals, company canteens, schools, hotels and restaurants.