Shares of Casino Guichard-Perrachon took a hit following the French grocer’s announcement that it is in discussions to sell the majority of its hypermarkets and supermarkets for €1.35 billion ($1.47 billion).
As of 0934 GMT, the shares were down 7.15% at EUR0.73, after initially rising by 8.9% earlier in the session. Over the past year, the shares have fallen by 93%.
Casino revealed that it is exclusively negotiating with Groupement Les Mousquetaires and Auchan Retail for the sale of over 300 stores. These stores generated sales of €3.6 billion in 2022, excluding value-added tax and petrol.
Analyst Nishant Choudhary of AlphaValue noted that this deal could lead to a positive impact on Casino’s valuation, as these stores have long been a source of concern.
However, there may be potential job losses as the new owner could seek to reduce the employee count. This could prompt political intervention due to the sensitivity and risk associated with such losses, Choudhary added.
Casino stated that the deal is still pending a binding agreement between all parties involved and could potentially be finalized by the end of the first quarter of 2024.
The proceeds from this transaction will be utilized to support the financial restructuring of Casino, which has been struggling with high debt and declining market share in its home country.
