Paz Withdraws from Mega Deal to Acquire Wolt Market
Translated & summarized from Ice by baba
Paz has withdrawn from acquiring Wolt Market, citing profitability concerns despite offering hundreds of millions of shekels. The grocery chain, operating 29 dark stores, generates over NIS 650 million annually but loses NIS 50 million per year. Three investor groups remain in the running, with a Rosenberg-Trabelsi led consortium reportedly most advanced. Wolt is selling due to regulatory pressure over competitive advantages.
The story in 5 lines · by baba
- Paz withdrew from the deal to buy Wolt Market due to concerns about profitability.
- Wolt Market generates over NIS 650 million annually but loses NIS 50 million per year.
- Three investor groups, including one led by Tor Rosenberg and Gabi Trabelsi, are still bidding.
- Wolt is selling its market operations due to regulatory concerns over competitive advantage.
- The sale process has been ongoing for months and may require a temporary trustee.
Paz, an energy and retail company known for its yellow convenience stores, has withdrawn from the race to acquire Wolt Market, the grocery arm of the delivery giant Wolt. Paz was considered a leading contender for the deal, which involves hundreds of millions of shekels, with offers estimated between NIS 250-300 million. The company decided to pull out after negotiations failed to reach an agreement, citing concerns that under the proposed terms, it would struggle to make the operation profitable.
Wolt Market operates approximately 29 "dark stores" across Israel, which are fulfillment centers not open to the public, dedicated to preparing orders for delivery. While the chain generates over NIS 650 million in annual revenue, it incurs losses of around NIS 50 million per year. Projections indicate these losses may continue due to high operating costs.
Paz's withdrawal leaves three main groups in contention: an investor group led by Tor Rosenberg and Gabi Trabelsi, the Good Pharm group involving Adam Fridler, Ohad Sandler, and Rami Levy, and the AMI fund, associated with Ori Max. The Rosenberg and Trabelsi group is currently seen as the most advanced in negotiations, though no final decision has been made, and the deal's completion timeline remains unclear.
Wolt is divesting its market operations due to a ruling by the Competition Authority. The authority expressed concern that Wolt's model of operating its own grocery chain while hosting competing retailers on its delivery app grants it an unfair competitive advantage. The sale process has already exceeded its original schedule, and if a sale is not finalized according to regulatory guidelines, the operation may be placed under temporary trustee management.