PAI Partners takes majority stake in Uvesco

PAI Partners agreed in December 2021 to acquire a majority stake in Uvesco from the founding family shareholders, who kept a significant interest, at an enterprise value of €500m. The investment was made through the firm’s mid-market fund, in that vehicle’s fifth transaction, and completed in April 2022. Founded in 1993 from the merger of two family-owned Basque food businesses, Uvesco runs supermarkets on a proximity model: stores of modest size placed within walking distance in towns and city districts rather than hypermarkets on the outskirts. Its proposition rests on fresh produce supplied by producers in the regions where it trades, with butchers, fishmongers and bakers working in store. It operated 277 stores across the Basque Country, Cantabria, Navarra, La Rioja and Madrid, the last entered in 2017, covering 197,015 square metres: 249 under the BM Supermercados name, eight Super Amara stores and 20 franchised BM Shop outlets. Five distribution centres in northern Spain served them, two for ambient goods and three dedicated to fresh products. It generated revenue of €500M–1bn in 2020, roughly double its 2008 level, having about doubled its market share over the same period. That model competes against the discounters on a different footing. It cannot match their prices, but a shopper buying fresh food several times a week values proximity and quality over the weekly trolley, and local sourcing is difficult for a national chain to replicate store by store. PAI backed expansion on two fronts: opening stores and franchises, principally in northern Spain and around Madrid, and acquiring other operators in a Spanish food retail market still divided among regional chains. The company kept its headquarters in Guipúzcoa.