FRANCE: Carrefour buys European mall business

By Katy Askew | 16 December 2013

Carrefour looking to boost business in western Europe

Carrefour looking to boost business in western Europe

French retail giant Carrefour has said it will buy 127 shopping malls in France, Spain and Italy from real estate group Klepierre for EUR2bn (US$2.75bn).

The group plans to form a shopping mall company "adjoining its hypermarkets" in Europe.

The sites generate gross retail income of around EUR135m, the company said in an announcement this morning (16 December). The business will be merged with Carrefour's existing mall interests, which comprise of 45 French shopping malls that generate gross annual rental income of EUR45m. Carrefour will take a 42% stake in the new unit.

"With over 800,000 sq. m of retail space, assets of EUR2.7bn and a value-creating renovation and extension plan, the company will rank among the leading European shopping mall companies," Carrefour claimed.

The group expects the deal to close in the first half of next year.

Show the press release

Carrefour announces plans to create a company for shopping malls adjoining its hypermarkets in Europe.

Carrefour signs a memorandum of understanding with Klépierre to acquire 127 shopping malls.

Continuing its back-to-basics strategy, Carrefour aims, through the creation of this company, to recreate an ecosystem that integrates all the components of each commercial site for the benefit of its customers. Its success rests on the coordinated renovation, modernisation and extension of its sites.

The project will lead to the creation of a company that will include 172 shopping malls originating from:

Firstly, the acquisition from Klepierre for €2.0 billion of 127 sites in France, Spain and Italy with gross annual rental income of around €135 million,

Secondly, the contribution by Carrefour of 45 shopping malls in France with a value of €0.7 billion and gross annual rental income of around €45 million.

With over 800,000 sq. m of retail space, assets of €2.7 billion and a value-creating renovation and extension plan, the company will rank among the leading European shopping mall companies.

The company will be financed through €1.8 billion in equity, 42% held by Carrefour with the remainder held by institutional investors, as well as through €900 million in debt. The company's results will be consolidated by the equity method in Carrefour's accounts.

The transaction, which remains subject to final agreement between the parties and the approval of the relevant regulatory authorities, will be submitted for consultation to employee representative bodies and should close in the first half of 2014.

Original source: Carrefour

Sectors: Mergers & acquisitions, Retail

Companies: Carrefour

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