Schwarz required to keep low markups after taking over Romanian retailer La Cocos

Romanian competition body said that it would require German retail group Schwarz to keep the low-cost profile of local La Cocos chain after takeover, but it generally welcomed the pledges made by the German group to smooth the deal. As well, there were no negative reactions from the market, competition council's president Bogdan Chiritoiu said, as quoted by Economica.net.

The Competition Council is expected to give its approval in the first part of this year on the transaction through which the German group Schwarz is to take over the largest chain of stores of a Romanian entrepreneur, by turnover, La Cocoș.

Schwarz is already the Romanian retail market's leader, with its chains Lidl and Kaufland.

"We will make certain changes (to the commitments already assumed by Schwarz), but there have been no hostile reactions from the market, and we will soon finalise this transaction. We want the low-cost model of La Cocoș to be preserved," explained Chirițoiu, also recalling that he wants the business model of La Cocoș to expand – 15 new stores are expected to be opened after the takeover.

Schwarz will be required to maintain the commercial markup that the La Cocoș chain currently practices.

"Obviously, we are talking about the average markup; we cannot look at each package of biscuits", explained the head of the competition authority, who said that requesting this type of commitment is a first for the institution as well.

(Photo source: the company)