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Casino Climbs Near 13-Year-High On Plan For Online Assets

Published on May 7 2014 8:42 AM in Technology

Casino Climbs Near 13-Year-High On Plan For Online Assets

Casino Guichard-Perrachon SA rose to the highest level in almost 13 years after saying it plans to merge its Cdiscount and Nova Pontocom e-commerce units and possibly spin them off in a US stock market listing.

The online retailer would have combined business volumes of $4.1 billion and serve consumers from Vietnam to Brazil, Casino of Saint-Etienne, France, said late yesterday. Casino is considering selling shares in the new company “to accelerate its development and increase its visibility.”

The stock rose to €91.34 at 9:23 am in Paris.

“This is a natural migration from the offline world into the online world and Casino is following the customer,” Bruno Monteyne, an analyst at Sanford C. Bernstein, said via e-mail.

Casino is cutting prices in France to revive sales, which declined there on an organic basis last year, while introducing new formats such as cash-and-carry in Thailand and online stores in South America, where revenue growth is strongest.

By pooling its e-commerce assets and spinning them off, the retailer would seek to ride a wave of US investor enthusiasm for technology and internet companies with exposure to emerging markets. Eight Chinese companies filed for $2.3 billion worth of initial public offerings in the first quarter.

Online marketplace Alibaba Group Holding Ltd. yesterday filed to raise as much as $20 billion, which would rank as the largest US IPO ever.

Web Platforms

France’s Cdiscount, which opened websites in Colombia, Thailand and Vietnam in the first quarter, sells everything from lingerie to scooters on its web platform. It had business volumes of $2.1 billion in 2013, Casino said in a statement.

Nova, the e-commerce company jointly held by Cia. Brasileira de Distribuicao and its Via Varejo SA (VVAR3) unit, had business volumes of $2 billion last year. It operates five consumer online retailers whose offerings range from travel to technology as well as an e-commerce consulting business.

Casino gained full control of Cia. Brasileira de Distribuicao, Brazil’s largest retailer, in September after billionaire Abilio Diniz resigned as chairman. The planned combination will be studied by both companies and submitted for approval, Casino said yesterday without giving a time frame.

Morgan Stanley and JPMorgan Chase & Co. were hired to manage a potential share sale of the combined units, Reuters reported, citing a source with direct knowledge of the situation. A Casino spokeswoman declined to comment on the hiring of bankers.


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