PARIS — Amid all the uncertainty heading into Sunday’s elections, Carrefour SA said Friday it was selling its stake in Greek joint venture Carrefour Marinopoulos to its partner, the Marinopoulos group, which will take over the management of operations in the context of Greece’s ongoing economic crisis.
Greece’s conservative, pro-bailout New Democracy party won the most seats in Sunday’s general election, and its leader Antonis Samaras said he wanted to form a government as soon as possible. Samaras said Greeks had voted to remain in the euro, and called for a national salvation government. The leader of the anti-bailout Syriza party, Alexis Tsipras, which lost narrowly, agreed Samaras should be first to try to form a coalition, according to a report.
Carrefour, the world’s second-largest retailer after Wal-Mart Stores Inc., said that as a result of the sale, it expected to record a mostly non-cash charge of around 220 million euros, or $274 million at current exchange, under discontinued activities.
Separately last week, Carrefour said it was buying Argentine discount supermarket chain EKI for an undisclosed sum to strengthen its footprint and expand its convenience store network in the Latin American country.
The announcements come at a turbulent time for the French retail giant, which is scheduled to hold its annual shareholders’ meeting today — the first under new director, chairman and chief executive officer Georges Plassat.
He took over last month after his predecessor Lars Olofsson submitted his resignation to Carrefour’s board and indicated he plans to retire, shortening the planned transition period between the two executives.
During Olofsson’s three-year tenure, Carrefour has struggled to turn around its ailing hypermarket business and posted a string of profit warnings. Emerging markets continue to be the growth engine for Carrefour, offsetting tough trading conditions in southern Europe.
Under the reorganization unveiled Friday, Carrefour Marinopolous will become the exclusive franchisee of Carrefour in Greece, Cyprus, Bulgaria, Albania and other Balkan countries.
“The Carrefour group reaffirms the confidence in the Marinopoulos family it has shown throughout the duration of their partnership by transferring the ownership and management of this leading company in a country to which the Marinopoulos family is firmly committed and in which they are best placed to ensure its management in the current context,” the company said.
Leonidas Marinopoulos, president of Marinopoulos Brothers SA, said the deal gave Carrefour Marinopoulos the flexibility to adapt to current trading conditions. “We reaffirm our commitment to the Greek and Cypriot markets alongside our employees and suppliers who have helped make Carrefour Marinopoulos the leading retail banner in Greece,” he added.
Meanwhile, Carrefour Argentina will take over 129 EKI stores, including 110 convenience stores and 19 small supermarkets, mainly located in the capital city of Buenos Aires and the surrounding areas.
Both transactions are subject to approval by antitrust authorities.