Carrefour Investor Opposes Individual Sale of Non-European Units

Carrefour SA (CA) investor Knight Vinke Asset Management LLC said it opposes the retailer selling assets outside of Europe individually and that management should focus on improving business in the region.

“The sale of Carrefour’s non-European activities, one by one, in an isolated manner, wouldn’t seem to us to be the good solution,” the activist investor said in a letter sent to management May 25. Knight Vinke owns about 10 million shares, or 1.5 percent of Boulogne-Billancourt, France-based Carrefour.

Knight Vinke sent the letter to Carrefour management this month after media reports the retailer had held talks with Cia. Brasileira de Distribuicao Grupo Pao de Acucar about merging their businesses in Brazil. Pao de Acucar has denied the reports of contact, while Carrefour has declined comment.

Pao de Acucar’s partner in the business, Casino Guichard- Perrachon SA, today said it had filed for international arbitration against the Diniz Group after discovering it had held talks with Carrefour, two people familiar with the matter said.

Carrefour Chief Executive Officer Lars Olofsson and Knight Vinke have butted heads over Olofsson’s plan to spin off 25 percent the grocer’s property business, which owns real estate assets in France, Italy and Spain. After shareholder opposition, Carrefour earlier this month delayed the plan, though it says it continues to prepare for a listing. Carrefour is still pushing ahead with an offering of its Dia hard-discount business in Madrid in July.


Olofsson has lost credibility with the market, Knight Vinke Chief Executive Officer Eric Knight said today. However, the company needs stability and his leaving at the moment would be “catastrophic,” Knight said.

Olofsson, 59, is trying to turn around Carrefour’s domestic business. He joined Carrefour in 2009 after a decade in which sales barely rose in France, Carrefour’s biggest market. The CEO is pinning the company’s success on a 1.5 billion-euro ($2.12 billion) revamp of 500 superstores in western Europe, betting a new format with lower prices and more own-label products will boost sales and profit through 2015. This month, he ousted the head of France and took direct control of the country after a lackluster first quarter.

Carrefour has mandated Lazard Ltd. to study a merger between its Brazilian unit and Cia. Brasileira de Distribuicao Grupo Pao de Acucar, according to media reports

Knight Vinke last year called for a breakup of Eni SpA, Italy’s biggest oil company, after building a stake. The New York-based investment firm has accumulated an 18 percent holding in Kesa Electricals Plc (KESA), owner of the Comet electronics chain in the U.K. and Darty in France, over the past year.

To contact the reporter on this story: Andrew Roberts in Paris at

To contact the editor responsible for this story: Celeste Perri at

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