RIGA - The Finnish retail trade company Kesko Food has taken over the former Globuss food shops in Riga and Sigulda.
The general director of Kesko Food, Henrijs Fogels, stated that on Oct. 31 the company concluded an agreement with Ilga-Sigulda LTD on the rental of three Globuss shops in Riga and one in Sigulda for more than 10 years.
According to Fogels, Kesko Food would gradually turn the four Globuss shops into low price shops under the Supernetto name, a process he expected to be complete by March of next year.
The first shop on Maskavas Street in Riga will be opened in the beginning of December.
In the long-term there are plans to increase the number of Supernetto store to 14, Fogels said.
President of Ilga-Sigulda Janis Bormanis called the deal mutually beneficial. He said that it would become more and more difficult for small players to survive on the retail food market since they cannot afford to work with a wide range of products.
Ilga-Sigulda will not fade away. The company said it planned to develop the catering and confectionery business, as well as real estate and recreation. Until now up to 60 percent of the company's efforts went into the retail trade and 40 percent into manufacturing and other business.
Commenting on the deal, the head of the Latvian Traders Association, Henriks Danusevics, pointed out that the market was undergoing a consolidation and that the trend would accelerate in the near future.
Fogels agreed, adding that retail trade in Latvia would be dominated by three big chains. He did not name them.
Currently Kesko Food manages four Citymarket supermarkets and eight Supernetto low-price shops.