French Company Casino Plans to Divest Brazilian and Colombian Subsidiaries
On Monday, French company Casino announced its intention to divest its Brazilian subsidiary Grupo Bread of Sugar and the Colombian Success as part of its efforts to reduce debt and ensure long-term sustainability.
This divestment is one of the measures implemented by Casino to strengthen liquidity and establish a sustainable capital structure. The company ended 2022 with a debt of 6.4 billion euros.
Last week, Casino also revealed the sale of its 11.7% stake in the Brazilian group Assai for 404 million euros. However, there is currently no specific date for the transfer of Éxito.
Casino Aims to Reduce Debt and Attract Potential Buyers
In 2022, the group generated approximately 17.8 billion euros in revenue from its Latin American operations, accounting for slightly over half of the total revenue of 33.6 billion euros. Casino has been striving to reduce its debt for several years and now aims to cut it in half through a reconciliation process that will extend until October.
Potential candidates to acquire the group include billionaires Daniel Kretinsky and Marc Ladreit, as well as the trio composed of Xavier Niel, Matthieu Pigasse, and Moez-Alexandre Zouari.
If the ownership change takes place, the Éxito group, which includes brands such as Carulla, Surtimax, Surtimayorista, Super Inter, and Viva shopping centers located in Antioquia, Barranquilla, Tunja, Bogotá, Villavicencio, and Buenaventura, will welcome new owners. The Éxito group is currently valued at 5.4 billion pesos.
French company Casino has announced plans to divest its Brazilian subsidiary Grupo Bread of Sugar and the Colombian Success in order to reduce debt and ensure long-term sustainability. Casino is implementing various measures to strengthen liquidity and establish a sustainable capital structure, with a debt of 6.4 billion euros at the end of 2022. The company recently sold its stake in the Brazilian group Assai for 404 million euros. Casino aims to cut its debt in half through a reconciliation process that will extend until October. Potential buyers for the company include Daniel Kretinsky, Marc Ladreit, Xavier Niel, Matthieu Pigasse, and Moez-Alexandre Zouari. The ownership change will affect the Éxito group, including Carulla, Surtimax, Surtimayorista, Super Inter, and Viva shopping centers located across several cities in Colombia. The Éxito group is currently valued at 5.4 billion pesos.
What steps is French company Casino taking to reduce its debt and ensure long-term sustainability, and how might this affect its subsidiaries in Brazil and Colombia?
French company Casino is taking several steps to reduce its debt and ensure long-term sustainability. Firstly, it plans to sell off non-core assets to generate cash and reduce its debt load. This includes selling supermarket chain Leader Price, as well as other properties and businesses that are not considered central to its operations.
Additionally, Casino aims to improve its operational efficiency by implementing cost-cutting measures and streamlining its operations. It plans to optimize its supply chain, reduce expenses, and focus on its core retail business.
These actions are expected to have implications for Casino’s subsidiaries in Brazil and Colombia. As Casino reduces its debt and improves its financial health, it will have more resources to invest and support its subsidiaries’ growth strategies. This could potentially lead to increased investments in these subsidiaries, allowing them to expand their presence and strengthen their market position.
However, there might also be some short-term impacts on the subsidiaries as Casino undertakes its debt-reduction measures. These measures may involve restructuring or streamlining operations, which could result in some changes or downsizing within the subsidiaries. Nevertheless, in the long run, Casino’s efforts to reduce debt and ensure sustainability will likely have a positive effect on its subsidiaries, as they will benefit from a financially stable parent company.