"Frans Muller will become CEO if Ahold and Delhaize merge" | RetailDetail

"Frans Muller will become CEO if Ahold and Delhaize merge"

"Frans Muller will become CEO if Ahold and Delhaize merge"

If Delhaize and Ahold merge, Belgian prices would be lowered and Dutch quality would grow, according to Rabobank. Petercam on the other hand claims Frans Muller will become the CEO of the resulting company, while Dick Boer will become chairman.

Lower prices, better quality

"The consumer will have to pay less for a better shopping experience", Belgian paper De Standaard writes. It is the conclusion of an analyst report from Dutch bank Rabobank the paper looked into. 

 

"They key will be the combination of Ahold's better purchase agreements and Delhaize's quality, Rabo believes. Similarly to Delhaize in Belgium, Albert Heijn has a reputation in the Netherlands of being a pricey supermarket. That point of view should improve when Delhaize products are added to the product range", the paper summarized the report. "Belgian prices would drop, because Albert Heijn can buy 10 % cheaper in the Netherlands than Delhaize can in Belgium."

 

Ahold supplies its Belgian Albert Heijn stores from Tilburg, in the Netherlands, and Rabobank believes it should be able to expand that operation to do similarly for Delhaize. The Netherlands also has a different approach, with more "flexible labour contracts" and "lower wages" because of "more student jobs", while also taking advantage of Albert Heijn's "more efficient logistics". According to Rabobank, the newly-formed company could theoretically even evade Belgium's prohibition to sell below purchase price, while there are areas of synergy for its private labels as well.

 

"It is remarkable that Rabobank estimates Delhaize's purchase advantages to be worth a mere 120 million euro, which does not even reach 0.3 % of Delhaize Belgium's turnover", De Standaard writes. "That improvement would not suffice to return to Delhaize Belgium's profitability from 2011. It also remains to be seen how much of these merger advantages will go straight to the stockholders."

 

"Delhaize will supply the CEO, Ahold the chairman"

Investment firm Petercam has also looked into the possible merger. Its analysts mainly focused on how the company would be structured at management level. It believes Frans Muller, the Dutch CEO of Delhaize since 2013, would become the overall CEO, while Ahold's current CEO (Dick Boer) would become chairman of the board.

 

We might know before the end of the month whether that prediction holds true, because several sources close to the talks have stated the merger could be finalized by then.

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