French agricultural group InVivo has agreed to buy gardening chain Jardiland to strengthen its position in a sector drawing competitors from do-it-yourself stores to internet distributors.
InVivo’s retail division will acquire Jardiland from investment fund L-GAM, which will become a shareholder in InVivo Retail, InVivo CEO Thierry Blandinieres told reporters.
Financial terms of the transaction were not disclosed, but Blandinieres said that InVivo may bring in other financial investors in its retail division alongside L-GAM.
Jardiland will add a third chain to InVivo’s gardening activities alongside Gamm Vert and Delbard.
InVivo and Jardiland had announced last month exclusive talks over an alliance under which their gardening chains would continue to operate separately, without giving further details.
Combined annual sales at the three chains represent more than 2 billion euros ($2.3 billion), including 730 million for Jardiland, and the acquisition will reinforce InVivo’s position as France’s largest garden retailer, it said.
“The idea is to work together faced with a market situation which is complicated for gardening pure players,” Blandinieres said. “Even if we’re a market leader, we’re under pressure from new entrants like mass retail and internet.”
Do-it-yourself retailers are now the biggest channel for garden products in France while online sellers were also growing fast, InVivo said.
In pet products, which represent a sizeable part of gardening stores’ sales, there was stiff competition from supermarkets in particular, it added.
InVivo did not anticipate significant regulatory hurdles given limited geographical overlap between Gamm Vert, which is concentrated in rural areas, and Jardiland, which tends to have large stores on the outskirts of towns, the group said.
The planned acquisition of Jardiland also marks another step in InVivo’s expansion in retail activities.
It is developing a grocery retail network under the Frais d‘Ici banner, seeing potential for 200 outlets in France.
InVivo’s activities also span agricultural supplies, animal nutrition, grain trading and more recently wine distribution.
The group generated sales of 5.5 billion euros in its 2016/17 fiscal year to June 30.