How Superhome’s potential attracted a foreign investor and how CTC and Ermes will benefit from the sale

The market is abuzz with the news of Superhome Center DIY transitioning to new ownership. It followed a preliminary decision by the Board of Directors of Ermes Department Stores Plc, a subsidiary of CTC Group, to sell its 51% stake in Superhome – and the minority shareholder to sell the remaining 49% - to an interested foreign investor.

Ermes announced its decision last week with a statement on the Cyprus Stock Exchange (CSE), with the deal – totalling €94 million (for 100% stake) – expected to be finalised and confirmed once the Ermes Board gives the go-ahead to sell its majority stake at the company's extraordinary general meeting of shareholders on 20 December.

Read more: Ermes announces intention to sell Superhome Center DIY to foreign buyer

Net proceeds and financial impact

It is worth noting, however, that the net amount the company is expected to make from the sale will be significantly less, as €13m will be retained to cover potential future expenses, and €7m for bank obligations at the time of the transaction's completion.

As a result of the above, it is understood that the net proceeds from the sale will amount to approximately €74m, with Ermes and CTC receiving just over €37m from the sale of Ermes' 51% stake in Superhome Center DIY.

Rationale behind the sale

The sale of Superhome Center DIY was deemed mature and beneficial by Ermes’ Board of Directors, both for the company and the parent CTC Group. The net proceeds will be allocated to settle approximately €11.3m in Ermes’ banking and related liabilities, while the remaining €25.8m will address bank obligations of the parent CTC and its subsidiaries.

This strategic move is expected to positively impact the financial optimisation of Ermes, while benefiting CTC and its shareholders by significantly reducing overall leverage across the group.

The prospective new owner

Citing sources, InBusinessNews has reported that the prospective buyer is a foreign investor with Greek roots. The investor is said to have recognised the growth potential of Superhome Center and intends to capitalise on the chain's dynamic market position.

About Superhome Center (DIY)

Superhome Center (DIY), a member of the CTC Group, employs over 400 people and operates in the home improvement and do-it-yourself (DIY) sectors.

Launched in 1999, the company now runs six hyperstores across Cyprus, along with an online store. It offers over 65,000 products across 20 different departments and also serves business-to-business clients, including hotels and institutions.