Galeries Lafayette owner Motier SAS bought a 6.1% stake in Carrefour SA (CA), saying the “strategic” stake is for the long-term and a reflection of confidence in the company’s future.
The Moulin family bought 44.2 million Carrefour shares via its holding company Motier, it said in a statement after European markets closed yesterday. The stake was valued at €1.3 billion ($1.8 billion) at yesterday’s close.
The purchase of a stake in Carrefour follows failures by Galeries Lafayette in the past year to acquire rival department stores Printemps and House of Fraser Plc. Carrefour is focusing on lower prices and convenience as it seeks to cement a revival in France and strengthen sales in the rest of Europe, Latin America and China.
Carrefour shares traded 1% lower at €28.86 at 9:10 a.m. in Paris after closing at the highest in three years yesterday. Lille, France-based Motier has no intention of increasing the stake, which was purchased on the open market, said a person familiar with the matter, declining to be identified as the plans aren’t public.
“The announcement helps explain the recent strength in Carrefour’s share” price, said John Kershaw, an analyst at Exane BNP Paribas in London.
Playing Brazil
Carrefour is considering selling a stake in its Brazilian business next year, Chief Executive Officer Georges Plassat said last month.
The Moulin family “should understand French retail and Carrefour offers an interesting way to ‘play’ Brazil,” Kershaw said.
Motier said it is also “actively pursuing its strategy of developing its core activity of department stores and will devote the necessary resources in the course of the coming years.”
Galeries Lafayette raised €1.18 billion from the sale of its 50% stake in Monoprix to Carrefour rival Casino Guichard-Perrachon SA (CO) in a deal reached in 2012.
Under CEO Plassat, Carrefour is focusing on Europe, Latin America and China after retrenching from markets where it viewed prospects as weak.
Carrefour shares have advanced 1.2% this year, giving it a market value of €21.1 billion.Bernard Arnault, France’s richest man, controls about 14% of the company in concert with Blue Partners and Colony Capital, France’s market regulator said in September.
A Carrefour spokeswoman declined to comment on the purchase. Groupe Arnault and Colony Capital couldn’t immediately be reached for comment.
Bloomberg
