X5 acquires alcohol distributor City 77 Group

MOSCOW. July 20 (Interfax) - PJSC X5 Corporate Center (MOEX: X5) (X5) has purchased City 77 Group, which distributes alcohol in the Central and North West federal districts, X5 said in a statement.

The details of the deal through which X5 became the owner of 100% of shares in City 77 LLC, ECOWINE LLC and Alco Nord LLC were not disclosed.

"The purchase of the distribution business of the City 77 Group is an important stage of expanding X5's own competencies and developing its product range," the managing director of Okolo, a chain of small stores operating under the Okolo franchise, said. "This asset will make it possible to cover all of the needs of independent stores joining the Okolo franchise. The distributor's unique competencies combined with the platform model of the Okolo business will make it possible to launch new sales channels adapted to changes in demand and the market environment."

The statement says that the purchase of the group is aimed at developing logistics infrastructure, expanding the client base of the Okolo franchise and increasing the products offered on the OKOLO.Market platform. It also says that City 77 currently has around 5,000 clients.

According to data from SPARK-Interfax, City 77 earned revenue of around 3 billion rubles and a net profit of 12 million rubles in 2025, with ECOWINE earning 1.6 billion rubles and 5 million rubles respectively and Alco Nord 130 million rubles and 1.4 million rubles.

X5 is planning to finish integrating the City 77 business by the end of 2027, as well as Nizhny Novgorod distributor VKT, which it purchased in May this year. The integration program involves expanding the geographical reach of both distributors, increasing their product range and launching the Big Shelf pilot project, which will allow X5 clients to pre-order goods from an expanded product range.

City 77 founder Nikolai Laushkin will be responsible for integrating the group's business into X5. This should "facilitate seamless business processes, interaction with key partners and staff retention".

As reported, X5 has been developing Okolo since 2023. The franchise is designed for experienced entrepreneurs who already run a retail business. The franchise interacts with X5 via B2B platform OKOLO.Market, which functions according to the classified advertising model and allows goods from X5 as well as a large number of independent sellers to be purchased in one place. There are currently around 7,600 stores in 55 regions working under the Okolo brand.