Ceconomy, parent company of MediaMarkt and Saturn, is putting its alliance with Fnac Darty on hold for now. The company wants to find a solution for its ongoing poor performance and financial troubles first.
Pause button
The two partners had high ambitions when they announced the European Retail Alliance last year: not only did they intend to construct a purchase alliance and develop private labels together, but they would also be co-operating in innovation and data analysis. Those plans are now put on hold: “We have hit pause,” as a spokesperson for the company puts it.
Ceconomy has other priorities right now: last year, the company released rather bleak results as both turnover and profit had gone down, causing the stock price to plummet as well. In October, CEO Pieter Haas left, followed by CFO Mark Frese in December. The electronics retailer sold its Russian division, faces trouble in Turkey and – like the entire industry – Ceconomy is also suffering from the pressure on prices and the growth of e-commerce.
Ceconomy has a 24 % interest in Fnac Darty. Both companies have expressed their desire to play a key role in the further consolidation of the European electronics market, but they lack the funds for new acquisitions right now.
