Maxeda

€ 2,400 million, Sep 2004

Consumer

Non-food retailer

Business
Maxeda is the leading non-food retailer and food service business in the Netherlands. Maxeda operates department stores, DIY, fashion stores and restaurants which are located in prime locations. All 11 formats have a unique identity and market positioning and span all market segments. Maxeda has almost 28,000 colleagues in the Netherlands, Belgium, Luxembourg, France, Spain, Germany, Denmark, Saudi Arabia, Egypt, Curaçao, Aruba and Turkey. Maxeda has c. 1,400 stores, 50% of which are located outside the Netherlands. The stores welcome 6 million visitors each week.

Strategy
Together with its partners in this investment, Cinven has strengthened the management team and implemented a strategy to focus on its core retail business.

During the first years of our ownership, the focus was on the improvement of all retail formats, the realisation of gains from working capital, and the sale and leaseback of the property portfolio. On a business portfolio level, we successfully divested of improved formats such as Hema and the Consumer Electronics business.

The retail improvement strategy has resulted in a strong increase in sales in existing stores and strong growth in its store network, more efficient sourcing, savings in costs and improvements in cash flow and the generation of synergies across the Group.

In the recently more difficult market environment, the focus is on value preservation, i.e. protecting sales, margins and cash flows.

Progress
Despite difficult trading conditions in the Netherlands, Maxeda continues to make good progress in implementing this strategy, with particular emphasis being placed on improving margins and reducing costs, working capital reduction, accelerating the integration of related formats and driving topline growth through better execution and strong marketing promotions.

The divestment of Maxeda’s property portfolio in 2005 and the subsequent divestment of Hema in 2007 have enabled Cinven to return 2.3 times our initial investment while retaining our equity ownership in Maxeda.