Ahold to focus on growth

Ahold (Amsterdam: AH.AS - news) , the Dutch retailer, said on Thursday two key board members would relinquish their day-to-day management duties in Europe and the US in order to "devote more time to growth opportunities".

The move was interpreted by analysts as a sign that the group is preparing itself for acquisitions. It had €2.6bn (£2.3bn, $3.9bn) in cash at the end of the second quarter and little debt.

"We're financially strong and we're ready to go into the next phase which is growth," an Ahold spokesman said, adding that "growth" could be viewed as acquisitions, organic growth, or expansion into adjacent markets.

Dick Boer, Ahold's chief operating officer for Europe, will hand management control of Albert Heijn, the dominant Dutch supermarket chain, to Sander van der Laan in January.

In the US, where Ahold makes 60 per cent of its revenues, Lawrence Benjamin, chief operating officer for Ahold USA, has appointed Carl Schlicker as chief executive of Ahold's US supermarkets: Stop&Shop, Giant-Landover and Giant-Carlisle.

The two will be given the task of exploring growth opportunities "in existing and new markets," Ahold said.

John Rishton, Ahold's British chief executive, said in August the group was ready to "seize opportunities" as the recession forced the pace of consolidation in the industry.

Since an accounting scandal brought Ahold low in 2003, the group has staged a recovery by divesting businesses, cutting debt and developing a formula for balancing margins and sales volumes. In the US, it has pioneered own-brand products which are not as pervasive as in Europe.

As a possible merger candidate, Ahold has been persistently linked with Delhaize, the Belgian supermarket group that also has a big US business, but Mr Rishton has also persistently said he has never met Delhaize's management. Delhaize said on Thursday it was not in talks with any food retailers about a merger or a transformational acquisition, Bloomberg reported.

However, analysts at ING this week suggested Ahold might instead be a target for Tesco (LSE: TSCO.L - news) , the UK retailer, given its relatively low valuation. They stressed the idea was their own rather than based on indications from either company but said the move would be logical as it would allow Tesco to expand in the US.

"Ahold could be viewed as a one-off opportunity to acquire an undervalued asset at a low point in the US consumer cycle," they wrote.