Carrefour focuses on Brazil and China

09 October 2009

PARIS: Carrefour, Europe's biggest retailer, has stated that Brazil and China are two of its key long-term target markets, amid rumours the company was under pressure to sell off its operations in these areas.

In the first half of this year, Carrefour's sales rose by 8.1% in Latin America, while revenue levels in Asia also improved by 14.8%, compared with declines of 3.6% in France, and 5.4% in Europe as a whole.

Late last month, Le Monde, the daily newspaper, reported that the hypermarket giant was being encouraged to sell its operations in China and Latin America by two of its major shareholders, Bernard Arnault, owner of LVMH, and Colony Capital, the investment company.

The news title added that the Paris-based firm's market value had fallen by 30% since 2007, and quoted Sebastien Bazin, head of Colony Capital's European arm, as saying it was due to undertake a substantial reorganisation by 2012.
"We are in a four-year plan, we have until 2012, we have time," said Bazin.

Le Monde followed this story up earlier this week, repeating the assertion that Carrefour could divest its stores in Argentina, Brazil and Colombia.

In September, the retailer argued the BRIC markets – Brazil, Russia, India and China – were its "highest priority" in terms of driving international growth.

Given the persistence of suggestions that this approach may now have changed, it issued a statement reaffirming its previous position.

"Carrefour Group is not in the habit of commenting on rumours, but given their recurrence, Carrefour denies the sale of its businesses in growth markets," the company said.
"The Group's geographic priorities are France, the other G4 countries [France, Spain, Italy and Belgium] and, in the medium-and long-term, growth markets, and particularly Brazil and China."

Data sourced from Bloomberg/Financial Times; additional content by Warc staff