Casino to Become Sole Controller of Brazil’s Pao de Acucar
Casino Guichard-Perrachon SA (CO), the French supermarket retailer, will exercise its option to become the sole controlling shareholder of Cia. Brasileira de Distribuicao Grupo Pao de Acucar, Brazil’s largest retailer.
Casino’s Chief Executive Officer Jean Charles Naouri will become chairman of Wilkes Participacoes SA, the holding company that controls the Brazilian retailer, Casino said yesterday in an e-mailed statement. Casino will also name most board members of Pao de Acucar, the statement added.
The move seals the exit of Abilio Diniz, chairman of the Brazilian retailer, from the group that controls the company that started as a bakery in 1948, founded by his father. Diniz, the oldest of six children, worked at the company, and bought control from his siblings in 1992. In 1999, Casino bought 24 percent of the group’s voting shares, and in 2005 increased its stake to 34 percent in an agreement that gave the French group the option to buy control of Pao de Acucar.
Diniz hasn’t been notified of Casino’s decision, according to his press relations office in Sao Paulo.
Casino on March 22 took the first step to take control of Pao de Acucar when it told Diniz that the French company would name Wilkes’s chairman. Diniz remains chairman of Pao de Acucar.
Last year, Diniz teamed up with billionaire banker Andre Esteves, CEO of Banco BTG Pactual SA, to merge Pao de Acucar with the Brazilian unit of Carrefour SA. The proposed merger, which would be financed in part by Brazil’s development bank BNDES, was a move to fend off the agreement that gave control of Pao de Acucar to Casino.
Casino described the proposal as hostile, filed a complaint against its Brazilian partner and denounced the move as illegal and in violation of the 2005 shareholders agreement.
After rejecting Diniz’s proposal to merge Pao de Acucar with Carrefour, Casino increased its stake in the retailer to more than 40 percent.
-- Editor: Jonathan Roeder
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