Dixy Group agreed to buy rival supermarket chain Victoria Group for 20 billion rubles ($680 million), excluding debt, the company said Thursday.
Dixy will pay in cash and shares. To finance the deal, Dixy will seek a loan for 4.5 billion rubles and issue additional shares on a pre-emptive rights basis to its existing shareholders.
Victoria Group operates 257 stores under the brands Kvartal, Dyoshevo, Victoria, Semeinaya Kopilka and Cash. The combined company will be the third-largest food retailer in Russia by revenue, selling space and number of stores.