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Germany's Spar plans major
reconstruction, job losses can be expected
The German Spar chain, which is majority owned by French Intermarché, will start a major restructuring process. Fritz Ammann, the new CEO, has announced that radical cuts can be expected. In 1999, the Spar chain made a loss of 357.8 million DEM or well over 150 million USD. The results for last year are also expected to be poor. Ammann says that the group intends to focus on its three core operations. These include the chain of 3,000 independent retail stores, for which Spar will produce wholesale services. Also the 900 Netto discount markets will continue as well as the 400 larger Eurospar consumer markets. There will be a reshuffle also in management, to accompany these changes. The future of the other parts of Spar is less clear. This includes the non-food retail sector, with 120 Kodi stores, as well as the cash and carries. Also the petrol station chain as well as the internet trader Einkauf 24 will either be sold or restructured. The new management has also said that it will stop the refurbishing of Eurospar markets into Intermarchès. Until now, 57 of these markets have already been changed. Changes like this always raise the question whether a sale or take-over of the whole company is possible, particularly as Wal-Mart is considered to have an expansion need to improve its profitability in Germany. The Spar management denies any intentions to sell, in the shorter or longer term
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