The consideration of selling its possessions in Russia is being pondered by Ceetrus Group, the owner and operator of nearly 300 shopping centers in Europe. This revelation was disclosed to Vedomosti by three advisors associated with the organization. Confirmation of this detail was provided by a company partner. As per his statement, “the subject of withdrawing real estate assets in Russia has sporadically surfaced with the shareholder of Ceetrus over the past few years, although no substantial negotiations with potential buyers have materialized yet.” Presently, information suggests that the sale of shopping centers is under review by the government commission or has possibly obtained approval from it, as shared by one of Vedomosti’s sources. This data remains unverified. The decision to sell real estate aids Ceetrus owners in mitigating the risks linked with owning assets in our nation, as explained by one of the advisors. He elaborated that this concern has notably intensified for foreign entities after the commencement of the SWO.
According to one advisor, the logistics operator Lidertrans based in Tatarstan is expressing interest in acquiring Ceetrus’s assets. The other two advisors are also aware of ongoing discussions with Lidertrans. There is no information available regarding other potential buyers. The Ceetrus representative in Russia declined to provide a statement. Queries directed to the company’s headquarters in France, as well as to Lidertrans, remain unanswered.
As indicated on its official website, Ceetrus is a subsidiary of the French Auchan group (part of the Mulier family along with Decathlon and Leroy Merlin). Formerly known as Immoauchan until 2018, Ceetrus operates 40 shopping centers and galleries in Russia, per its website. Notably, the company possesses Aquarelle shopping complexes in Pushkin, Volgograd, Tolyatti near Moscow, along with the Troika complex in Moscow. The advisors note that Ceetrus also holds checkout areas in Auchan hypermarkets. The total portfolio size is estimated to be around 180,000 square meters per their information. Conversely, the Ceetrus website cites a figure of 150,000 sq. m.
Lidertrans specializes in offering road freight services in Russia, Turkey, Georgia, and Central Asian nations. Established in 2009, the company’s fleet comprises 1503 units. The principal registered entity, LLC TEK Lidertrans, is based in Naberezhnye Chelny, indicated by SPARK-Interfax. With a revenue of 8.3 billion rubles in 2022, the primary owner is businessman Mikhail Ustyuzhanin. The group has actively engaged in real estate investments since the previous year, including the acquisition of the Metropolis business center (110,000 sq. m.) from American Hines and Czech PPF Real Estate. Also, negotiations are reportedly in progress for purchasing stakes in two outlets from Hines – Outlet Village Belaya Dacha in Kotelniki near Moscow and Outlet Village Pulkovo, as per RBC reports.
There is uncertainty regarding Lidertrans’s intention to acquire all Ceetrus assets. While two advisors affirm that the deal encompasses all company facilities, another source suggests interest only in operational shopping centers and not the Auchan hypermarket checkout areas. Estimates regarding the market value of Ceetrus assets vary, with CORE.Marina Malakhatko valuing it at 21.6 billion rubles. Opinions from Mikael Kazaryan, the Head of Capital Markets and Investments at IBC Real Estate, and Stanislav Bibik, a partner at NF Group, point to around 20 billion rubles.
Consultants highlight that Ceetrus malls and galleries stand out as some of the last remaining assets of foreign entities available for acquisition in Russia.
Alan Baloev, heading the Capital Markets department,The department at Commonwealth Partnership highlights the considerable allure of these assets to investors due to government commission approval resulting in a significant discount to market price, typically around 50% (Source: Vedomosti). Moreover, when selling the business as a whole, the price may be further reduced, as argued by Bibik. Baloev notes that Ceetrus shopping malls are relatively small, enhancing their liquidity. He also points out that many are situated in regions with lower competition compared to cities like Moscow. Malakhatko identifies “Watercolor” in Volgograd and “Troika” in Moscow as the most successful projects under Ceetrus.
However, this diversified portfolio also poses the primary risk for investors, according to consultants. For instance, Alexey Segal, a partner at Ricci | Blackstone, cautions that the new owner will need to rebuild all business processes practically from the ground up, considering the current dynamics of the retail real estate market. Malakhatko echoes this sentiment, suggesting that certain facilities within the company may require a concept overhaul to boost visitor footfall.