Casino intends to sell Grupo Pão de Açúcar – 06/26/2023 – Market

The French company Casino announced this Monday (26) that it intends to sell its South American subsidiaries, the Brazilian Grupo Pão de Açúcar (GPA) and the Colombian Éxito, in an effort to reduce its debt and guarantee economic sustainability.

This is one of the publicly announced measures to reinforce liquidity and guarantee a perennial capital structure for the group, which ended 2022 with a debt of 6.4 billion euros (R$ 33.3 billion).

The Casino group, which announced last week the sale of its 11.7% stake in the Brazilian wholesale chain Assaí for 403 million euros (R$ 2.11 billion), has not disclosed a precise date for the sales of GPA and Success.

Activities in Latin America represented a turnover of 17.8 billion euros (R$ 92.7 billion) in 2022, just over half of the group’s total for the year: 33.6 billion euros (R$ 174.9 billion ).

At the end of 2022, the group had almost a thousand stores in Brazil and more than 2,100 in Colombia, in addition to 33 in Argentina and 96 in Uruguay. Almost 75% of Casino’s 200,000 employees work in South America.

The group has struggled for several years to overcome the difficulties and now hopes to reduce its debts by half as part of a conciliation process, which could continue until October 25th.

The company thus hopes to convert into capital “at least all unsecured debts”, that is, more than 3 billion euros (R $ 15.2 billion). This means that the creditors who lent the amount will be shareholders of the group (instead of recovering the amounts).

Czech billionaire Daniel Kretinsky, who controls 10% of Casino’s shares, has proposed to several creditors to exchange up to 40% of the debt for cash or equity, or both. French businessman and billionaire Marc Ladreit de Lacharrière defends one of the offers to take charge of the group.

Kretinsky offered a contribution of 750 million euros (R$ 3.9 billion) for a capital increase of more than 1 billion euros (R$ 9 billion).

The other offer, presented by the trio of French entrepreneurs Xavier Niel, Matthieu Pigasse and Moez-Alexandre Zouari, also foresees offering creditors the opportunity to “reinvest in capital”.

The Casino network also intends to raise 900 million euros (almost R$ 5 billion) “in the form of own resources to provide the company with the necessary resources to implement its strategy” 2023-2025.

In addition to the sale of the stake in the Assaí chain, the group announced other measures to preserve its liquidity.

The group obtained an agreement from the French State to postpone the payment of taxes and social charges, in an amount corresponding to 300 million euros (R$ 1.57 billion). The creditors received the request for suspension of interest payments and debt maturities until October.