Cencosud is expanding in Argentina with the acquisition of Makro and Basualdo supermarkets for $122.5 million. This marks its entry into the wholesale cash-and-carry market. Cencosud plans to invest $610 million in 2025, with aims to enhance physical stores and digital capabilities, signaling intent for significant growth and strategic investment in the retail sector.
Cencosud, the Chile-based retailer, is expanding its footprint in Argentina through the acquisition of Makro and Basualdo supermarkets for $122.5 million (€119.3 million). The total cost may vary depending on net debt and working capital, as stipulated in the acquisition agreement. This deal marks Cencosud’s debut in the Argentinian wholesale cash-and-carry sector, with funding sourced from its existing financial resources.
Makro and Basualdo have over 35 years of market experience operating 28 cash-and-carry stores across 12 Argentine cities, including Buenos Aires, Santa Fe, and Córdoba. The stores are primarily company-owned, and Makro is known for its strong private-label offerings. Cencosud’s CEO, Rodrigo Larraín, emphasizes the strategic advantages of this acquisition, citing potential synergies with its current operations in Argentina, along with their cash-and-carry expertise gained from the Brazilian market.
Projected financial outcomes for Cencosud include revenue of $17.95 billion (€17.49 billion) and an adjusted EBITDA of $1.87 billion (€1.82 billion) in 2025, anticipating an adjusted EBITDA margin of 10.4%. These projections are bolstered by robust margins in strategically important markets, including Chile and the U.S., while also factoring in improvements in Colombia and Brazil.
In addition to this acquisition, Cencosud plans to invest $610 million (€594 million) across its operations in 2025, representing a 16% increase from the previous year. This investment will fund the opening of approximately 24 new supermarkets, including 12 Fresh Market stores in the U.S., effectively expanding their sales capacity by 44,000 square meters. Additionally, funds will be allocated toward store renovations, digital advancements, and logistics enhancements.
Cencosud functions in multiple countries, including Argentina, Brazil, Chile, Peru, Colombia, and the U.S., with support offices in China and Uruguay. The company utilizes a diverse multi-format strategy with extensive operations that include 1,129 supermarkets, 117 home improvement stores, 48 department stores, and 67 shopping centers, along with financial services.
Cencosud operates as a multi-national retailer, providing a broad range of products and services across several Latin American countries. By acquiring Makro and Basualdo, Cencosud is venturing into the wholesale sector, expanding its product offerings and market reach. The cash-and-carry model is prevalent in Latin America, catering to both retail and hospitality businesses. As the retail landscape evolves, acquiring established players helps Cencosud strengthen its competitive position and optimize operations across markets.
The acquisition of Makro and Basualdo signifies Cencosud’s strategic growth into Argentina’s wholesale sector, leveraging the established reputation and market presence of these brands. This expansion aligns with Cencosud’s overall investment and growth strategies aimed at increasing revenue and enhancing operational efficiency across multiple markets. The commitment to improve and expand its offerings, particularly in Argentina, underlines Cencosud’s long-term vision for regional leadership in retail.
Original Source: www.esmmagazine.com
