Carrefour to acquire Cora and Match Banners for €1.05B

Casino's difficulties have unblocked the long-awaited consolidation of the French market. The Carrefour group, France's number 2 retailer, is to acquire Cora and Match stores. This is Carrefour's first major acquisition in France in 20 years.

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A deal worth for €1.05B

Last Wednesday, Carrefour announced a deal with Belgian retailer Louis Delhaize to acquire its Match and Cora stores. This is a significant acquisition for France's No. 2 retailer, since it represents 60 hypermarkets and 115 supermarkets, generating pre-tax sales of €5.2 billion in 2022, and EBITDA of €189 million.

The transaction is valued at €1.05 billion, giving a post-synergy EV/EBITDA multiple of 4.2 times. The EV/EBITDA ratio (enterprise value/EBITDA) is often used to determine a company's value. All in all, the potential synergies offered by the acquired stores are estimated at 110 million euros on an annual basis 3 years after the effective completion of the transaction.

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Neck and neck with Leclerc

Firstly, this acquisition is a way for Carrefour to strengthen its geographical presence in certain areas of France, such as the East of France and Hauts-de-France, where Cora has more than 25 hypermarkets. Strengthening its stores in these two regions will enable Carrefour to compete head-on with the E.Leclerc banners, which have a strong presence in these regions of France.

Secondly, the operation will enable the Carrefour group, a challenger in the market, to add the 2.5% market share of Cora (1.8%) and Match (0.7%) to its 19.8% market share. All in all, Carrefour has consolidated its number 2 position and is now close on the heels of Leclerc, leader in the French supermarket sector (with 23.5% market share).

These figures are all based on Kantar Worldpanel data.

Thirdly, with this takeover, Carrefour is sending out a signal to other players in the supermarket sector, during market turbulence: it is in good financial health. However, despite an operating profit of 2.3 billion euros by 2022, the group will have to find the means to finance this operation, as its debt stands at 3.4 billion euros.

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