Carrefour flags Brazilian listing via stake sale to Diniz
PARIS (Reuters) - Supermarkets group Carrefour has sold a 10 percent stake in its Brazilian business to billionaire Abilio Diniz, securing local retail expertise to support growth in its second largest market and in a first step towards a separate listing.
Diniz' investment company Peninsula has bought a 10 percent stake in the business for about 1.8 billion reais (£425.4 million), the France-based retailer said in a statement on Thursday, confirming information provided on Wednesday by a source with direct knowledge of the situation.
Carrefour said the transaction had closed, and that "this opening of the capital of the Brazilian subsidiary could also include a listing on the Brazilian stock exchange in the future".
In addition, it said, Peninsula holds options allowing it to raise its stake to a maximum level of 16 percent within next five years.
The deal marks the 77-year-old Diniz's return to retailing. The eldest son of the founder of GPA SA , Carrefour's Brazilian arch rival, he left the company in September last year to turn around BRF SA , a Brazilian processed foods company that is the world's No. 1 poultry producer.
Carrefour has a 40 year history in Brazil with 256 stores there under the Carrefour Bairro and Carrefour Express format. It had 34 billion reais of sales there in 2013 - about one eighth of its global total group revenue.
(Reporting by Andrew Callus; Editing by Leigh Thomas)
