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News/ Mercator to Sell Intersport and Modiana
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05/07/2016
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​Recent news reports are claiming that Mercator is expected to sell its chains of sporting goods stores, Intersport and Modiana, by the end of July. This kind of activity would be the latest in a longer line of investments that Mercator has been selling off, including Pekarna Grosuplje and Mercator-Embi, all of it as means of shifting the corporate focus to the company's main activity – trade.

Media reports further show that entrepreneur Goran Kristan is currently the front-runner for the purchase of Modiana. Kristan is the owner of two retail companies and the wholesale of German brand, Tom Tailor, in Slovenia, as well as in other SEE markets. Considering the fact that Kristan's partner is an Indian textile manufacturer, there are expectations of Modiana to expand its range of brands on offer – a range that currently includes Fashion Avenue, Beautique, and Modna Kuca in Maribor, among others. An employer of 685 people at the end of 2015, Modiana has an established presence in Slovenia with 48 stores, as well as in other Ex-Yugoslavian countries, although it has been operating with weaker results recently, especially in Serbia and Croatia. A company that has otherwise been generating more than 3.5% of Mercator's Group overall profit, spent the better part of last year operating with significant losses. Finally, it is reported that only Modiana's business operations will be up for sale, and not its real estate, since it is planned for the real estate to be rented by its new owner on a long term basis.

On the other hand, Intersport ISI is still considered as one of Mercator's most profitable subsidiaries, and considering the fact that it is owned by Swiss-based Intersport group, Mercator will only be selling the regional part of the Intersport franchise. According to latest reports, Polish private equity fund, Enterprise Investors, has already made a binding bid in this case. There are 110 Intersport stores currently in the region, and it is expected that the new owner will primarily focus on expanding to Serbian and Croatian markets. The Polish fund has so far invested EUR 2.4 billion in 113 enterprises across various industries.

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