French retailer Casino has been forced to drop its plans to join forces with Teract. However, three major French entrepreneurs have stepped in to save the supermarket group.
No direct farmers’ deal
Casino is stuck between a rock and a hard place: the French retailer has amassed a debt of more than five billion euros, while its CEO Jean-Charles Naouri is under investigation for corruption. The 74-year-old was even placed in temporary custody last week. Now, the French retail group has also lost its future acquisition partner, LSA magazine reports.
Teract and Casino have announced the end of their exclusive negotiations, that been going on since 9 March. The two companies had been negotiating the merger of their distribution activities in France and the establishment of joint supply chains. The main aim of the agreement was to enable Casino to obtain supplies directly from French farmers who are members of Teract’s holding group’s agricultural cooperatives. However, even with the talks failing, the two parties say they may still enter into an operational partnership for bakery products and fruit and vegetable sourcing.
Turnaround by a trio
So where does this leave Casino, in need of substantial financial help? Three French businessmen are emerging as possible saviours: billionaire telecoms entrepreneur Xavier Niel, newspaper owner Matthieu Pigasse and Casino franchisee Moez-Alexandre Zouari is working on “a sustainable industrial and financial solution for the Casino group”, as they phrased it.
Initially, they will invest just over 300 million euros, but their ambitions go much further. All parties that are “wishing to participate in the turnaround of a historic retail player” are welcome, as long as they “respect the history and identity of the company.” In total, they hope to raise more than one billion euros. The trio have already secured the support of creditors and hedge funds.
The agreement with Les Mousquetaires will nevertheless continue: Intermarché will take over around a hundred of the supermarket group’s shops.