16 Feb 2018 14:34

Magnit CFO Khachatur Pombukhchan appointed CEO

MOSCOW. Feb 16 (Interfax) - Magnit's board of directors, the principle shareholder of which will no longer be founder Sergei Galitsky, but VTB , had ended Galitsky's tenure as CEO as of February 16.

He will also cease to be chairman of the board from this date.

Magnit CFO Khachatur Pombukhchan has been appointed CEO from February 17 for a three year tenure, the retailer said in a statement.

Galitsky, the founder of Magnit, which was the leader on the Russian retail market for many years before surrendering first place to X5 Retail Group, also created Football Club Krasnodar and a soccer school, said he plans in future to engage in child and youth soccer. FC Krasnodar is not part of the deal between VTB and Galitsky. The bank has no relation to the club, a VTB spokesman told Interfax.

"I led the company for 25 years. That is a pretty long time. I think that the time has come, probably, to change something in my life. It seems to me that this was a good time, but... This was not an easy decision for me because this process has been too long for me. After all, I founded this company, but time passes and nothing lasts forever. Actually, it was the impetus that Magnit's investors do not quite see the situation as shareholders of the company," Galitsky said at the deal signing ceremony.

"I am an entrepreneur. I am after all probably more focused on profitability, EBITDA, low debt. The current market demands other things: growth, the number of store openings, like-for-like, aggressiveness. This is a big company: it is more managerial, where more procedures are needed, where the demands of the market, capitalization must be answered, not personal entrepreneurial initiative. I don't think I should stand in the way of this process and, if investors want changes, they should get them. Therefore, when I thought about a sale, probably, VTB is the best there could be in this instance, because they have a fair amount of experience in this area and there are retail company purchases where they have achieved success. I spoke with them, they have fairly good ambitions and financial strength backing them. I am not forecasting, but this opens up new opportunities for M&A deals, for attracting ambitious management in future," he said.

"I think that having this experience, the VTB group will do everything so that the company develops further. It will move forward without me. I think that we have done quite a lot. This was a time that was very interesting for me. I am thankful that VTB embarked on this deal, because I felt that the company needs changes. There are not so many such buyers on the market that have the specialized functions for changing the company," Galitsky said.