The French retail giant Carrefour announced Sunday 23rd June 2019 that it sold 80% of its business in China to a Chinese distributor, for 620 million euros
The distribution giant Carrefour announced Sunday 23rd June 2019 that it will sell 80% of its activities in China to the Chinese group Suning.com for a total of 620 million euros.
“The price for the acquisition of 80% of the shares of Carrefour China is 4.8 billion renminbi or 620 million euros,” said the group in a statement, saying that this transaction should be “effective ‘here the end of the year 2019’.
The price of € 620 million “may be subject to adjustments at the date of completion of the transaction, depending on the evolution of net debt and working capital requirements of Carrefour China”, is -He specifies.
Following this transaction, Carrefour will retain 20% of the new entity and two seats out of seven on the Carrefour China Supervisory Board.
Turnover down
The agreement with Suning.com also provides for various terms and “windows” over the next four years to sell the remaining 20% stake held by Carrefour to the Chinese group.
“This cash transaction values Carrefour China on the basis of an enterprise value of € 1.4 billion,” which includes the value of equity, various debts and the value of minority interests, says Carrefour.
Present in China since 1995, Carrefour China operates 210 hypermarkets and 24 convenience stores. This entity generated revenue of 3.6 billion euros in 2018, down almost 10% year-on-year.
Suning.com is a retail giant in China with more than 8881 stores in more than 700 cities and the third largest e-commerce platform in the country, according to data presented in Carrefour’s press release.
