Carrefour buys stake in Showroomprivé

Carrefour buys stake in Showroomprivé

Carrefour has obtained a 17 % minority stake in flash sale seller Showroomprivé with the intent of increasing its digital and non-food reach. Former shareholder Conforama did suffer a loss.

 

"New step in sped up digital strategy”

French Showroomprivé is the second largest European private sales company, offering flash sales to its members from a range of well-known brands. Carrefour will acquire all shares from household chain Conforama, part of the Steinhoff group, for 79 million euro. 

 

The deal is part of both companies’ strategy to create a strong omnichannel product range, according to a press release. Both companies will work together in several areas, including commercially, for marketing, logistics and data. “This partnership is a new step in the acceleration of our digital strategy, in an omni-channel approach. It also allows Carrefour to enter the online private sales market and strengthen its offering”, Carrefour CEO, Alexandre Bompard, said.

 

 

Private sales in hypermarkets?

The collaboration also gives Showroomprivé options to improve its omnichannel approach, according to founders Thierry Petit and David Dayan. They did refrain to mention how private sales could actually become a more omnichannel phenomenon.

 

The duo will keep its majority vote in Showroomprivé’s General Assembly and still controls about a third of the capital. Carrefour will 13.7 % of voting rights, but the deal still needs to be approved by the French Bureau of Competition.

 

78 million euro loss for Conforama

It is remarkable that Carreour pays about half of what Conforama paid for the shares in May 2017: Conforama paid 27 euro per share, worth 175.4 million euro, 78 million euro more than what Carrefour paid.

 

Back then, it was the idea to help Showroomprivé grow internationally thanks to Conforama’s store network, while its stores could also serve as a pick-up location. Conforama’s product range and purchase network would also be suited to help organize private sales and at the same time, the household retailer wanted to learn from Showroomprivé’s digital and mobile expertise.

 

Parent company Steinhoff is now in financial turmoil, following a major accounting scandal and temporary guardians have been placed at the head of Conforama. In order to safeguard the company’s future, it needed to find 200 million euro quickly, which explains the rapid sale of shares to Carrefour.