Aldi's sale of 11 buildings raises €76m for expansion

GERMAN-OWNED DISCOUNT supermarket chain Aldi has raised more than €76 million to fund its ongoing expansion by selling 11 of its supermarket buildings to a partnership based in Manchester. The company's parent will remain the ultimate owner of the stores after the deal, which was funded by Bank of Ireland.

The sale and leaseback transaction, completed a fortnight ago, mirrors a similar arrangement in late 2006 through which Aldi realised almost €44 million from the sale of seven supermarket buildings in a deal with Bank of Scotland (Ireland).

The expanding chain, which next week opens its 55th Irish store at Listowel in Co Kerry, plans to open another 21 outlets before the end of 2009. In addition, the company is developing a new distribution centre at a cost of €100 million on the site of a former Dairygold grain store in Mitchelstown, Co Cork.

Aldi, which does not disclose its sales or profits in Ireland, has a share of up to 5 per cent of the grocery market, according to research by the Competition Authority. The privately held firm sells food and household products under its own brands at a discount to other large grocers.

Records filed in the Companies Office in recent days show that Aldi Stores (Ireland), which operates the Irish business, sold 11 supermarket buildings to Omega Retail Properties 2 Limited Liability Partnership for a total of €76.22 million. "Aldi Stores [Ireland] have no comment to make," said a spokesman.

While the immediate ownership of Omega Retail is not clear from filings in the British companies registry, it is understood that ultimate control of the properties remains within the Aldi organisation. The transaction is structured in a way that enables the company to take cash from the property portfolio while continuing to do business at the sites in question.

The Companies Office filing shows that the outlet at Mayfield Business Park in Cork realised €11.52 million and the store at Ballyphehane in Cork was valued at €10.2 million. A store at Dublin Road in Limerick realised €8.89 million, the Ferrybank outlet in Co Waterford realised €8.23 million, the Arklow store €8 million and the Naas outlet €7.6 million.

The other realisations were: Claremorris, Co Mayo €4.91 million; Mitchelstown, Co Cork €4.7 million; Buncrana, Co Donegal €4.4 million; Carrick-on-Suir, Co Tipperary €3.9 million and Tullow, Co Carlow €3.86 million.