Russian consumer electronics retailer M.Video-Eldorado announced on Friday its plan to invest an additional $350 million in store expansions, new city entry, and boosting online sales in the first half of 2025 to follow through its three-year strategy.
Reports from Kommersant and Vedomosti newspapers in January indicated that state-owned Promsvyazbank, under sanctions in the defense sector, is negotiating the acquisition of M.Video. The potential sale is seen as a solution to M.Video's growing debt issues, potentially aligning the retailer closely with the Russian state.
Felix Lib, CEO of M.Video-Eldorado Group, mentioned forthcoming corporate governance, board of directors, and top management changes. Details about new shareholders will be revealed later, with an initial payment of 11.5 billion roubles already received.
For the March-April period, the company intends to invest 30 billion roubles ($350.88 million) to propel its long-term development strategy. This investment surpasses M.Video's current market capitalization of around 21 billion roubles, leading to a more than 7% surge in the company's Moscow-listed shares.
M.Video, with approximately 1,240 stores nationwide, has diligently expanded its online presence since the onset of the COVID-19 pandemic. Alongside Promsvyazbank, M.Video is actively engaging in the online marketplace competition in Russia, alongside key e-commerce players like Wildberries and Ozon, tech leader Yandex, and well-funded banks such as Sberbank.
(1 USD = 85.5000 Russian roubles)