French supermarket operator Casino has initiated the process to take sole control of leading Brazilian retailer Companhia Brasileira de Distribuicao.
Casino said yesterday (21 March) it has informed Abilio Diniz, head of the Diniz Group that co-owns CBD with Casino, that it will exercise its right to remove him from his position as chairman of the Wilkes’ board of directors and appoint a replacement. Wilkes is the holding company that controls CBD, also known by its trading name Grupo Pao de Acucar, or GPA.
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A spokesperson for the French retailer said this was a “contractual right” laid out in an agreement signed between the two parties in 2005. According to Casino, this contract allows the company the option of becoming CBD’s sole controlling shareholder on 22 June this year.
“With this step Casino demonstrates once again its long term commitment to Brazil and its full confidence in GPA’s bright future and in GPA’s outstanding management team,” Casino said.
Since 2005, Casino and the founding Diniz family have jointly managed CBD. However, the relationship between Casino and Diniz started to publicly sour last year, when Diniz proposed a merger between CBD and the Brazilian arm of Carrefour. The merger attempt ended amid opposition from Casino shareholders, which led the Brazilian state bank that was set to part fund the deal to back away from the idea.
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