(BFM Bourse) – The title plunged on the Paris Stock Exchange on Thursday, and closed down 9.4%.
The coincidence of the calendar means that the CEO of Casino, Jean-Charles Naouri, is auditioned by the financial brigade while his group, in financial difficulty, is at a pivotal moment.
The leader of the distribution group was taken into custody on Thursday as part of an investigation for price manipulation and insider trading. This investigation had been opened by the National Financial Prosecutor’s Office in 2020 for acts which would have been committed during 2018 and 2019, following a report from the Financial Markets Authority.
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This police custody – although unrelated to the group’s recent news – comes as Casino entered conciliation proceedings with its creditors last week, to potentially renegotiate its debt, of just over 5 billion euros at the end of March. The group is also the subject of two proposals. The first, from the Czech businessman and minority shareholder Daniel Kretinsky, proposes to inject 1.1 billion euros of capital, including 750 million via his holding Vesa Equity Investments. The second consists of a merger with Teract, a subsidiary of the InVivo cooperative and owner of Gamm vert and Jardiland. The Groupement Les Mousquetaires has joined the discussions on this possible merger with Teract.
Contacted by BFM Bourse, Casino did not comment.
Towards a strong dilution?
On the stock market, the Casino action continues its descent into hell. Very volatile, it closed down 9.4% to 5.05 euros, its historic low, after having already lost 3.6% the day before and 6.8% on Tuesday.
The link of cause and effect between the police custody of the leader and the decline of the title is hardly obvious if not zero. Moreover, the action fell by more than 8% shortly before the press reports appearing reporting this police custody.
“It’s all even a little messy and it can weigh on market sentiment,” however, judges a financial analyst. “It can complicate things when a person is not reachable at the moment T and complicate the negotiations a little”, he adds referring to the discussions with Teract and Daniel Kretinsky.
Another financial intermediary points to “a set of elements” that could explain the fall in the title, in particular a further downgrading of the credit rating by Moody’s on Wednesday to “Caa3” against “Caa1” previously. This is the third lowest rating on the rating agency’s scale. “Custody can have a psychological impact, especially with ESG investors [environnement, social, gouvernance, les critères extra-financier, NDLR] “, he adds.
Casino lost just under 20% over the last five sessions. The market can also factor in the potential high dilution for minority shareholders of Daniel Kretinsky’s proposal and, to a lesser extent, that of Teract. This while Casino weighs more than just over 550 million euros on the stock market. “In any case there will be dilution” believes the analyst quoted above.
Julien Marion – ©2023 BFM Bourse
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