AMSTERDAM -- The Dutch supermarket retailer Ahold, seeking to streamline global operations and reduce debt, said yesterday that it will sell its holdings in Spain to Permira Funds, for roughly $849 million.
Ahold said it expected to close the deal before the end of the year. Ahold operates nearly 600 stores in Spain and the Canary Islands, with net sales last year of about $2.5 billion.
In November, the company said that it wanted to sell its operations in Spain, as well as the US supermarket operators Bi-Lo and Bruno's. [The Stop & Shop Supermarket Co., based in Quincy, is part of the Ahold USA group.] The income from the sales would be used to reduce by about a third $8.4 billion in outstanding debt.
Chief executive Anders Moberg said the divestment in Spain was part of Ahold's strategy "to optimize our portfolio and to strengthen our financial position."
Permira is a European-based private equity firm which acts as adviser to the 18 Permira funds, totaling approximately $13.6 billion. The Permira Funds have invested in more than 260 transactions in 15 countries.
Ahold is recovering from an accounting scandal that forced it to reduce its estimated earnings in 2000-2002. It is still under investigation by the US Securities and Exchange Commission and by Dutch financial authorities.
Before the problem became public in February 2003, Ahold was the world's third-largest retailer, in terms of sales, after Wal-Mart Stores Inc. and France's Carrefour SA. But it has slid in the rankings since.