Metro becomes Sligro in Belgium, a change that the Dutch wholesaler is eagerly anticipating. But what to expect from this stock market listed company, whose rise has been far from smooth?
Eyeing the top threefgv
For years it looked like a David versus Goliath battle: local Dutch foodservice wholesaler Sligro versus German multinational Metro. The announcement of Sligo’s arrival in Belgium in 2015 therefore raised some eyebrows. The opening of a branch in Antwerp was hampered for a long time by competitors, while the start-up costs were high. It was not until the end of 2018 that the impressive premises were finally able to open for business.
However, the group has no lack of ambitions: in 2017, Sligro acquired its Belgian competitors ISPC and Java Foodservice, the company recruited Gamma CEO Rudi Petit-Jean and the wholesaler set on to conquer the fragmented Belgian landscape. From the outset, Sligro made its goal clear: the Dutch group wanted “to be at least in the top three in the Belgian foodservice market, with an eye on the number one position”. In 2023, once the acquisition of Metro is completed, this number one goal will become a reality.
A very difficult start
Of course, the strong statements at the time were (at least partly) intended to divert attention from the struggling domestic market. In the Netherlands, the listed wholesaler was already the market leader, but growth was lacking. Its main weakness was its Emté supermarket chain, which was unable to cope with the increasing consolidation of the Dutch supermarket landscape. The formula was abandoned in 2018, and the shops were split between Jumbo and Coop (now Plus).
In 2019, Sligro saw its profits halved, despite all its efforts. For example, Sligro had been able to take over all of Heineken’s wholesale activities, including the supply of beer to the on-trade, which still boosted sales in the long term. But “the economic climate in the Netherlands and Belgium cooled down considerably in the first half of the year”. In Belgium, the start was “very difficult” as well – and all of that was before the coronavirus hit…
2022: the breakthrough year
“Things are going well, but not without effort”, CEO Koen Slippens said with relief in the middle of the year. In the autumn, turnover returned to pre-pandemic levels. In Belgium, growth was even 65 % in the first half of the year, and Sligro saw its chances with rival Metro. The company, which is feverishly seeking to expand, showed willing to spend big on its prey. 47 million euros, plus 75 % of the value of inventories and cash, to be precise.
Only the competition investigation remains to be finalised. A formality, says the wholesaler, since the Belgian market watchdog has already given the go-ahead. Although Horeca Totaal, which has already opposed a Sligro store in Bruges and also wanted the Metro store in Liège, may still protest. Its argument: the merger threatens free competition. For Sligro, this however means that 2022 will be the year of its big breakthrough: the acquisition will propel the Dutch group overnight to the position of market leader, an ambition it has had for over five years.