Kesko to build a more uniform customer experience in the grocery trade

KESKO CORPORATION PRESS RELEASE 27.11.2014 AT 09.10 1(2)

Kesko will integrate K-citymarket Oy, the non-food part of the K-citymarket chain currently part of the home and speciality goods division, into Kesko Food Ltd and change the present food trade division to the grocery trade division starting from 1 January 2015.

The grocery trade chains will be K-citymarket, K-supermarket, K-market/K-extra and the K-ruoka stores in Russia. The companies belonging to the division will be Kesko Food Ltd, Kespro Ltd and Keslog Ltd, as well as K-citymarket Oy starting from 1 January 2015.

Starting from 1 January 2015, Jorma Rauhala will be the Senior Vice President responsible for the grocery trade.

The Management Board will be composed of: Johanna Kontio, Vice President for K-citymarket,; Ari Sääksmäki, Vice President for K-supermarket; Jesper Åberg, Vice President for K-market; Kari Heiskanen, Vice President for K-ruoka Russia; Mika Halmesmäki, Managing Director of Kespro Ltd; Ari Akseli, Vice President for commerce; Mika Rautiainen, Vice President for marketing and concept services; Juhani Rontu, Vice President for store sites and retailer functions; Petteri Niemi, Vice President for logistics and information management; Anne Hujala, Vice President for finance and HR.

The K-citymarket, K-supermarket, K-market and K-extra stores offer the most diversified selections in their size categories. K-citymarkets will be developed to provide the best hypermarket services. K-supermarkets offer the most wide-ranging solutions for cooking and the K-market chain's stores are renewed to offer the best local services. In the future, food online stores in different parts of Finland will provide customers with the home delivery or the click & collect service.

- Over 900 K-food retailers with their personnel serve their customers with their superior food expertise. We will clarify our customer promise and improve the shopping experience in all of our chains in order to increase our competitiveness, says Jorma Rauhala, Senior Vice President for the grocery trade division (starting from 1 January 2015).

Cooperation negotiations about changes planned in Kesko's home and speciality goods trade, the building and home improvement trade and the food trade were started on 7 October 2014 in Kesko's home and speciality goods trade companies and building and home improvement trade companies in Finland and in Kesko Food Ltd, Kesko Corporation and K-Plus Oy. The negotiations were completed on 24 November 2014. A total of approximately 2,800 people were included in the negotiations and the combined reduction need in the companies was estimated at a maximum of 230 full-time equivalents. As a result of the negotiations, the total need for reductions in personnel was confirmed at 193 full-time equivalents, of which 61 are allocated to companies belonging to the grocery trade division starting from 1 January 2015. The reductions also include possible pension plans and terminations of fixed-term employments.

In 2013, the net sales of the grocery trade division totalled around five billion euros. The division employs approximately 7,500 people in Finland and Russia.

Further information is available from Jorma Rauhala, Senior Vice President for the grocery trade division (starting from 1 January 2015), tel. +358 105 322 211.

Kesko (www.kesko.fi) is a retail specialist whose stores offer quality to the daily lives of consumers. Kesko's chains have about 2,000 stores in the Nordic and Baltic countries, Russia, and Belarus.