American investment fund Knight Vinke has launched a personal attack on Carrefour CEO Lars Olofsson, who currently also holds the position of chairman of the board of directors. The Americans say Olofsson is responsible for the “débâcle” of the last few years and want the company to be generally split in two – to which the unions object fiercely.
Five profit warnings in one year
The Americans, representing 1.5% of all Carrefour’s shares, demand Olofsson’s resignation and the installation of two separate CEOs: one for Europe and one for Asia and America. In a letter in French newspaper Le Monde, Eric Vinke claims that Olofsson is “not independent enough” and that he is responsible for the terrible state the world’s second largest distributor is in.
The French group has known some difficult times of late, including five profit warnings in one year, a number of musical chairs sessions at the top and – most important for Vinke – a 45% drop in shares since January.
Start of a complete spin-off?
The European Workers Committee has protested heavily against Vinke’s proposals: they think a structure with two CEOs implies a will to break the Carrefour group in two. Representatives of all Carrefour trade unions, meeting in Bucharest, fear a split into a (stagnating) European branch and an ’emerging markets’ branch might put European jobs at risk. Their opinion is that Carrefour now needs stability and a clear focus on the Planet format, the plan to revamp the decaying European hypermarkets.
Knight Vinke earlier lead a (successful) rebellion against Carrefour’s plans to sell its property branch. In this battle, Vinke and the unions fought side by side. Carrefour refused to comment on this new attack on its strategies and its chairman and CEO.