Ljubljana, 28 July (STA) - Slovenian furniture chain Lesnina has been sold to Austrian furniture retailer XXXLutz for an undisclosed sum pending approval by the competition authorities, Lesnina chairman Bojan Papic told the press on Wednesday.
The company was sold by the sole shareholder Siringa, one of the firms involved in the management buyout of Lesnina in 2008, based on a contract signed in early July.
Due diligence is ongoing and Papic expects the go-ahead from market regulators by October at the latest.
XXXLutz said in a statement that it would preserve the Lesnina brand in Slovenia. Ljubljana will also become its headquarters for Southeast Europe and the Lesnina management will stay on.
"We rely on local know-how and management...We'd be crazy to sell the brand," XXXLutz board member Ewald Repnik told the press.
Lesnina was not soliciting bids, but when it received an offer from XXXLutz it found their development concepts matched, according to Papic.
Both Papic and Repnik rejected the notion that financial difficulties were the reason for the deal.
"We did not go into this deal out of economic necessity," Papic said. "Lesnina is a good retailer," added Repnik, who said the company convinced them with its strategic position, good performance and excellent management.
The Austrian firm, which says it is the world's No. 2 furniture chain, said in a statement that the acquisition would strengthen Lesnina's position by sparing it direct competition from XXXLutz.
The deal gives XXXLutz, which has been operating in Austria, Germany, the Czech Republic, Slovakia and Hungary, a foothold in Slovenia as well as Croatia, where Lesnina operates six outlets, and Serbia, where it has 11 stores.
The Lesnina group posted sales to the tune of EUR 200m last year, whereas XXXLutz had revenues of EUR 2.6bn.
Papic said Lesnina held 20-25% of the Slovenian furniture market.