In Focus: Aldi plots 5bn spend

German discount grocery chain Aldi North is planning to spend more than €5bn to revamp its stores around the world, which would be its biggest investment project ever, German weekly Bild am Sonntag has reported, citing company sources.

Aldi and its German discounter rival Lidl have become giants in European retail, challenging Ireland’s and the UK’s grocery retail markets, and are challenging US retailers as well.

Aldi North’s sister chain Aldi South announced plans last month to invest $3.4bn (€3bn) to expand its US store base to 2,500 by 2022, raising the stakes for rivals caught in a price war. Bild am Sonntag said that Aldi North planned to finance its multi-billion-euro investment from existing cash rather than by taking on debt. However, the paper said the project still needed the approval of one of the three foundations that control the company, which has been the subject of a family feud.

Aldi North was not immediately available for comment.

German brothers Karl and Theodor Albrecht pioneered the discount store concept, setting up two sister businesses serving north and south Germany in 1962 and then expanding to much of Europe as well as the US and Australia. Theodor had placed control of Aldi North in the hands of three foundations, all of which must approve any strategic decisions.

Aldi North most recently said it had just over 4,800 stores in Europe, in addition to more than 460 more upmarket Trader Joe’s stores it operates in the US.

In Ireland, Aldi, with around 11% of the grocery market share, trails its German discount rival Lidl which has a share of around 11.3%. Their combined shares make the German outlets the second largest grocery retailers, behind SuperValu.


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