(Boursier.com) — Crossroads concluded, on July 12, an agreement with the Louis Delhaize group with a view to acquiring the Cora and Match brands in France, reaffirming its leadership in the food distribution market in France.
The Cora and Match brands operate 60 hypermarkets and 115 supermarkets respectively and employ nearly 24,000 people in France. They generated a turnover excluding tax of 5.2 billion euros in 2022 (4.3 billion euros excluding petrol), for an EBITDA of 189 ME. The store network acquired presents a very strong geographical complementarity with that of Carrefour, with particularly high market shares in the Grand Est and Northern regions of France, where Carrefour has little presence.
The operation includes the acquisition of the premises of 55 hypermarkets and 77 supermarkets.
The transaction, which is expected to be finalized in the summer of 2024, values the assets acquired on the basis of an enterprise value of 1.05 billion euros. It will be accretive to the Group’s adjusted net earnings per share from the first year.
The integration of the Cora and Match stores offers significant synergy potential, estimated at 110 ME of EBITDA on an annual basis 3 years after the effective completion of the transaction. The associated integration costs, spread over 2 years, are estimated at €200 million (investments and operating expenses).
At the same time, Carmila, in which Carrefour holds 36%, has reached an agreement with the Louis Delhaize group to take over their 93% stake in Galimmo, which owns 52 shopping malls adjacent to Cora stores.
Alexandre Bompard, Chairman and CEO of the Carrefour Group, said: “With the acquisition of the Cora and Match brands, Carrefour announces its first major acquisition in France for more than 20 years and consolidates its leadership in food distribution in its domestic market. This friendly operation will allow Carrefour to continue the adventure started in France by the Bouriez family and the Louis Delhaize group, with which our Group shares a common culture, history and values”.
Synergies
The pooling of the respective strengths of Carrefour, Cora and Match will create strong value, with an amount of annual synergies estimated at 110 ME of EBITDA, 3 years after the effective completion of the transaction.
Structure of the transaction
The acquisition will be made 100% in cash, on the basis of a enterprise value of 1.05 MdEreflecting an acquisition multiple after EV/EBITDA synergies of around 4.2x, a highly accretive multiple based on the Carrefour Group’s current valuation.
The transaction remains subject to the approval of the French competition authority and to customary conditions. Given the strong geographical complementarity of the two Groups, Carrefour considers the challenges of competition to be limited.
Finalization is expected in the summer of 2024.