Lovells

Lovells has advised X5 Retail Group N.V. (X5) − Russia's largest food retailer in terms of sales − on its acquisition of a major Russian regional hypermarket chain, Karusel, through the acquisition of Formata Holding B.V. (Formata).  The total purchase price was around US$940 million and the transaction completed on 26 June 2008.  

Karusel’s real estate portfolio includes 23 operating hypermarkets, located in St. Petersburg, the Moscow region and other regions of the Russian Federation, as well as three hypermarkets under construction and eight land plots potentially suitable for hypermarket construction.   

The Lovells team was led by corporate partner Richard Ufland in London and Moscow based partners Dominic Pellew and Oxana Balayan, who is managing partner of the Moscow office and Lovells' relationship partner for X5.  The team involved a number of lawyers from the London, Moscow and Amsterdam offices, including Philip Corser in London together with consultant Maria Baeva, senior associate Richard Cowie and Natalia Konovalova in Moscow and senior associate Joost Broekhuis in Amsterdam (all corporate), and Moscow based partner Natalia Gulyaeva assisted by Konstantin Bochkarev (intellectual property). The Moscow real estate team led by consultant Taras Oksyuk, with assistance from senior associate Dmitry Smirnov, associate Natalia Miroshnichenko and associate Shamil Sadykov, advised on the real estate aspects.

Richard Ufland said:

“This deal was completed thanks to the co-ordinated advice of Lovells' Moscow, Amsterdam and London offices in a number of different specialist areas, and is evidence of the strength of Lovells' international corporate practice.  X5 is a highly valued client of the firm and we were delighted to be able to assist X5 in implementing this significant transaction.  The increasing number and sophistication of deals coming out of Russia and Eastern Europe play to our firm’s strengths, given the range and depth of service we are able to offer on an integrated basis throughout Europe.”  

Oxana Balayan said:

"It has been a pleasure working with our long-standing client X5 Retail Group on this acquisition, which is of great strategic importance to X5 within the Russian food retail market.  We look forward to working with them again in the future.”

Previous work for X5 Retail Group

Lovells has developed a strong relationship with X5 since first advising on its formation through the merger of two major retail chains, Pyaterochka and Perekrestok, in 2006.   

In April 2007, the firm advised X5 on the acquisition of 40 franchise stores, with a total net selling space of over 13,000 sq m, in the city of Chelyabinsk.