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Thailand’s CP All and three funds compete for Polish retailer Zabka, say sources: Reuters

Thailand’s top convenience store chain CP All Pcl and three private equity funds are competing to buy Polish retail chain Zabka from Mid Europa Partners, in a deal valued at up to 1.5 billion euros ($1.59 billion), sources familiar with the transaction said.

A sale of Zabka comes at a time when some policies of the ruling conservative Law and Justice (PiS) party are considered an investment risk.

Thai CP All, which operates 7-Eleven stores, CVC Capital Partners, TPG and Hellman & Friedman are left in the process to buy Zabka, sources said confirming earlier media reports and adding that BC Partners, which had looked at the chain too, quit.

Binding offers are due mid February, sources also said.

London-based private equity firm Mid Europa Partners, which focuses on central and eastern European investments, bought Zabka in 2011 for 400 million euros.

Zabka had sales of 5.75 billion zlotys ($1.39 billion) in 2015 and says that with 3,400 stores it is the largest chain of convenience stores in the country, competing with Portuguese company Jeronimo Martins’ Biedronka chain.

In November Mid Europa Partners bought Romanian supermarket chain Profi from Polish Enterprise Investors fund for 533 million euros.

“The Romanian supermarket chain has been sold with the EBITDA ratio of 11-12. If Mid Europa has agreed to buy Profi with such a ratio, I assume that they will be expecting to achieve at least the same ratio while selling their portfolio company,” one source said.

Mid Europa, CP All and CVC were not immediately available to comment. TPG, Hellman & Friedman and BC Partners declined to comment.