September 26, 2018 / 1:05 PM / 8 months ago

Spain's DIA loses market share to rivals Lidl, Mercadona

MADRID, Sept 26 (Reuters) - Spanish discount supermarket chain DIA has seen its market share tumble this year, according to industry data on Wednesday, the latest sign of the store’s struggle to compete with rivals Mercadona and Lidl.

DIA has lost more than two-thirds of its market value since a 2015 peak and has one the country’s lowest profitability ratios per square metre for grocery stores.

The company’s woes have left it as one of the most shorted stocks in Europe.

DIA’s market share has shrunk to 7.7 percent by Aug. 12 from 8.4 percent at the start of the year, market researcher Kantar Worldpanel said. In comparison, direct domestic rival Mercadona has gained 1 percent and now controls a quarter of the Spanish grocery market.

Meanwhile, German chain Lidl has seen its market share grow 0.5 percent to 4.8 percent in the same period.

In an effort to revamp its image, DIA named a new CEO last month and has pledged to launch a new strategic plan before the end of the year.

However, uncertainty continues to hang over the company’s future as rumours circulate on whether its biggest investor LetterOne, which holds a direct and indirect stake of 25 percent, will make a full offer or not. (Reporting by Emma Pinedo; Editing by Paul Day and Adrian Croft)

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