Praktiker’s main shareholder wants the retailer to pull out from Eastern Europe

Maseltov, the main shareholder of German DIY retailer Praktiker, wants the company to close its operations in Eastern Europe, a Maseltov representative told Financial Times Deutschland (FTD), according to Mediafax.

Austrian investment fund Maseltov which owns 10 percent of Praktiker, wants to convince other shareholders at the company’s future shareholder meeting of the necessity to sell the group’s operations in Eastern Europe, said Isabella de Krassny, fund manager and spokesperson of Maseltov. Praktiker’s second largest shareholder is another Austrian investment fund, Semper Constantia, with a 5.01 percent participation. Selling its subsidiaries in Eastern Europe could bring Praktiker between EUR 50 million and EUR 70 million estimates FTD.

The retailer reported EUR 348 million loss in first nine months of last year, compared to a negative result of EUR 100,000 a year ago. For the third quarter, the company announced losses of EUR 26 million, whereas for Q3 2010 it registered a profit of almost EUR 12 million.

Praktiker saw a 24.4 percent decline of its sales in Romania (-26.1 percent like-for-like) in the first nine months of 2011 to a total of EUR 116.1 million, according to the company’s report. Poor results n Romania come after in 2010 also the company has reported sales decreases. Praktiker Romania reported net sales of EUR 193.6 million in 2010, 21.8 percent less than the previous year, due to the general economic climate and an overall decline in the DIY market.

The Praktiker Group operates – including Max Bahr – around 440 home improvement and DIY centers in nine countries. About 110 stores are outside Germany, 27 of which are located in Romania. The retailer also has operations in Luxembourg, Greece, Poland, Hungary, Turkey, Bulgaria, Ukraine and Albania.

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The German DIY retailer announced last November that it will close its operations in Albania, reduce the number of stores it runs in Germany by 15 percent and reevaluate its international operations. The Praktiker management has agreed upon a EUR 300 million investment plan that would bring the company to profit in about three years’ time. Part of the money could come from selling its operations in Eastern Europe, including Romania.

Simona Bazavan