Carrefour in Brazil retail merger war with Casino
FRENCH supermarket giant Carrefour is poised to attempt to take control of Brazil’s top retailer, Grupo Pao de Acucar, from arch-rival Casino in a bold move to broaden its footprint in a top emerging market.
The talks on a merger between Carrefour, which has been struggling with a stagnant domestic market, and Pao de Acucar, were initiated by the Brazilian supermarket chain’s chairman and would count on financial backing from government development bank BNDES. But France’s Casino is unlikely to part with its prized Brazilian assets and branded the move “illegal” and of an “obvious hostile nature” in an attack on Carrefour yesterday.
“Given that Casino have co-control, they should be able to block it,” Bernstein analyst Christopher Hogbin said. A merger of Carrefour’s existing Brazilian stores with Pao de Acucar would create the country’s largest retailer with estimated sales of more than €30bn (£26bn) and a network of 2,386 stores.
A deal would be subject to being cleared by regulators.