Tuesday, July 6, 2010

Carrefour Said to Seek Buyers for Three Southeast Asia Units

July 6 (Bloomberg) -- Carrefour SA, the world’s second- biggest retailer, plans to exit Singapore, Malaysia and Thailand, and is seeking offers for its operations in the Southeast Asian countries, said four people familiar with the matter.

Carrefour has approached potential buyers and may ask for bids by early September, said two of the people, who declined to be identified because the sale process isn’t public. The combined operations may fetch $800 million to $1 billion, they said. Florence Baranes-Cohen, spokeswoman for Paris-based Carrefour, declined to comment.

The retailer will consider selling the units separately as potential buyers may not be interested in bidding for all three combined, according to two of the people. Carrefour’s Thai business may have a value of $500 million to $600 million, while the Malaysian and Singapore operations may be valued at $350 million to $400 million, the people said. Carrefour plans to retain its units in China and Indonesia, they said.

“It’s a positive move, in line with what the company has been doing,” Fabio Fazzari, an analyst at Equita Sim in Milan, said by telephone. “The new management is more focused on non- capital intensive retail. What they’ve been seeking to do for about a year now is get rid of all underperforming assets.”

Tesco Plc, the U.K.’s largest supermarket chain, Japan’s Aeon Co., Hong Kong’s Dairy Farm International Holdings Ltd. and Thailand’s Big C Supercenter Pcl may be putting in a bid, three of the people familiar with the matter said. South Korea’s Lotte Group was earlier approached to make a bid, they said.

Aeon, Tesco, Lotte

Aeon spokesman Eiichi Yamatani declined to comment, saying Japan’s second-largest retailer is “checking the situation.” Zhuang Nanbin, vice president for corporate affairs at Tesco China, wouldn’t comment on “market rumors.”

Both Lancy Ng, spokeswoman for Singapore-listed Dairy Farm, and Pimwanich Poolkasem, head of investor relations at Big C, declined to comment in phone interviews today.

Lotte Group isn’t considering a purchase of Carrefour’s assets, Lee Byung Hee, a Seoul-based spokesman, said by phone.

Carrefour is “obliged” to listen to offers for its businesses in markets where leadership is unattainable, Chief Executive Officer Lars Olofsson told shareholders in May. Asia was Carrefour’s smallest market by sales in 2009, accounting for about 7.5 percent of the total, according to the company’s website. France was the biggest, generating 43 percent, followed by the rest of Europe at 36 percent.

Carrefour plans to open 22 hypermarkets and 140 discount stores in China this year, Olofsson said in May. The retailer also intends to add 13 stores in Indonesia, where it recently sold a 40 percent stake to Trans Corp., a unit of Para Group.

Carrefour this year agreed to sell 40 percent of its Indonesian business to Trans Corp., forming a strategic partnership in the country. It didn’t disclose the price.

The retailer may opt for a franchise model in India, and plans to open its first wholesale outlet in New Delhi in the next few months, Jean Noel Bironneau, managing director of operations in the South Asian nation, said in May.

--With assistance from Andrew Roberts in Paris, Anuchit Nguyen in Bangkok and Sungwoo Park in Seoul. Editors: Chitra Somayaji, Frank Longid

To contact the reporter on this story: Cathy Chan in Hong Kong at

To contact the editors responsible for this story: Philip Lagerkranser at; Frank Longid at

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