Russia’s largest retailer in terms of sales, X5 Retail Group will develop its online business using experience of well-known online retailers in Russia. X5 has acquired a 51% stake in IT Business, a joint venture with the owners of online stores Bolero.ru and 003.ru, for $1 million. In addition, X5 has an option to purchase the remaining 49% stake in IT Business within 5 years at a price based on business performance using an agreed formula.
eHouse Holding, the owners of Bolero.ru and 003.ru, contributed to the new joint company their rights to the online properties, as well as their key employees and essential business infrastructure including IT equipment, call-centre, software, databases and leasing rights to a distribution center. The online stores, which have 70,000 daily visitors, will continue operating under their existing brands.
Founded in 1999, Bolero.ru sells books and entertainment media. It’s the second most popular online retail store in Russia. Founded in 2000, 003.ru sells household appliances and electronics. It has one of the largest turnovers in the category.
X5 Retail Group was created in May 2006 as a result of merger between discounter chain Pyaterochka and supermarket chain Perekrestok. In June 2008, X5 acquired hypermarket chain Karusel.
As of September 30, 2009, X5 operated 1,217 stores in Moscow, St. Petersburg, other Russia cities and Ukraine as well as 586 stores under franchisee agreement across Russia. For the first half of 2009, X5 reported net sales of $3,978 million, EBITDA of $347 million and net profit of $48 million .