Kesko Group, one of Finland’s two largest food retailers, announced Tuesday that it would be closing down 42 units of a chain of Siwa and Valintatalo stores that it had acquired early last year.
When Kesko concluded the acquisition, it was ordered by the Finnish Consumer and Competition Authority to sell off 60 stores to competitors. The company had a deadline of April 11 to complete the transactions.
However Kesko by the time the deadline came, Kesko had only managed to sell 10 stores, eight of them to merchants from the independent small supermarket chain M-ketju.
The competition authority said in a release that Kesko’s failure to sell off some links in the chain would not prevent the deal from going through, because Suomen lähikauppa, the company behind the Siwa chain, "would have exited the market anyway, because of its financial difficulties."
Kesko said that it will now convert eight of the 50 unsold stores to K-markets. It is already in the process of absorbing more than 400 other Siwa and Valintatalo outlets into the Kesko network.
Earlier this year, Kesko announced restructuring talks at 53 other Valintatalo and Siwa stores involving nearly 260 employees. Those discussions resulted in 206 job losses.