Carrefour to acquire Brazilian food retailer Grupo BIG Brasil for €1.1bn

Grupo Carrefour Brasil, a subsidiary of French supermarket chain Carrefour, has agreed to acquire Grupo BIG Brasil, a Brazilian food retailer, from Advent International and Walmart, for R$7.0 billion (€1.1 billion).

The consideration consists of 70% in cash and 30% in newly issued shares of Carrefour Brazil.

Grupo BIG Brasil has a multi-format network, made up of 387 stores. It generated R$24.9 billion gross sales in 2020.

On the other hand, Carrefour Brazil operates 489 stores and had posted R$74.7 billion gross sales in 2020.

According to Carrefour, the acquisition will bolster its subsidiary’s footprint in the high growth potential market. It is also said to enable it to provide a wider range of products and services for Brazilian consumers at more competitive prices.

Carrefour to acquire Brazilian food retailer Grupo BIG Brasil for €1.1bn. Photo courtesy of Grupo BIG Brasil.

Carrefour Brazil, through the acquisition, will expand in its traditional formats, particularly Cash & Carry through the Maxxi banner and hypermarkets through the BIG and BIG Bompreço banners. It will also extend its presence in formats in which it has a more limited footprint, especially the Bompreço and Nacional supermarkets and the Todo Dia proximity stores.

Additionally, Carrefour Brazil will get to operate in a new market segment with the Sam’s Club format, via a license agreement with Walmart.

Alexandre Bompard – Chairman and CEO of Carrefour Group said: “Our Group is on the offensive: The acquisition of the BIG Group is a major transformation movement for Carrefour Brazil. In this continental country with immense development prospects, we have accentuated our leadership in the food distribution market over the past 3 years, and BIG will further strengthen it with very complementary formats and locations.

“The transaction fits perfectly into the Carrefour Brazil ecosystem and into the Group’s acquisition strategy, centered on the consolidation of our key markets. The significant synergies generated by this transaction are a lever for creating additional value and a powerful addition to the profitable growth model that we have established across our Group.”

Following the closing of the transaction, Carrefour Group will own nearly 67.7% of the enlarged Carrefour Brazil, while Península Participações will hold 7.2%, and Advent International and Walmart through affiliates will have a combined stake of 5.6%.

The deal, which is subject to clearance from Brazilian antitrust authority – CADE, approval of Carrefour Brazil’s shareholders, and other customary closing conditions, is expected to close next year.