This time, Casino can’t wait any longer. The distribution group must speed up its restructuring and take action. In two weeks it will complete the sale of its GreenYellow subsidiary, from which it will recover 600 million euros in cash. Casino will have nearly completed its €4.5bn asset disposal plan. But it will not be able to pay its debt, which continues to rise and reaches a maximum of 7.5 billion euros in the first half of 2022.
Its main banks, Crédit Agricole, BNP Paribas and Natixis, have been waiting for four years to reduce the group’s debt. The sale of real estate and non-strategic subsidiaries (such as Leader Price or Floa Bank) is no longer enough. Casino is a “place file” that concerns all major French banks. Officially, they remain silent. But in anonymity, now they want forceful action.
The tone is changing inside the banks
Its operations in Brazil, Colombia and Uruguay are around 2,500 million euros. Casino reorganized them and then divided them into three to more easily sell them by country. “It will be done but it takes time, try to temporize a source in the entourage of Casino. Colombia and Uruguay can be sold in the first quarter of 2023”. Hurry up. In January 2024, he will have to pay off a debt of 800 million euros and this time the banks will not postpone the deadline. “All the commitments with the creditors will be kept”, promises a source close to the group.
But the tone has changed within the Casino banks. For four years, the pressure was on the personal companies (Rallye, Euris, Finatis, etc.) of the owner and CEO, Jean-Charles Naouri. Rallye, which controls Casino, is crumbling under €3bn in debt, but Casino has so far held out. From now on, the entire “galaxy” is in the sights of investors while the group is already worth less than a billion euros on the stock market. And the French banks, which have lent to every floor of the building, are stuck. “Everyone is caught up in the holding cascades and no one has an interest in it falling, another Casino banker figures out. We need an orderly restructuring.”
Open the capital of France to a partner
According to our information, the banks are having strategic discussions, together with Casino, around a new approach in France with Monoprix, Franprix and CDiscount. The rest of the story is still up in the air… There are several options. The strong method would be to back the group with one of its competitors, Carrefour or Auchan. “It is the only way to recover as much money as possible, says a manager of a Casino bank. Although we know very well that we will never be fully reimbursed.” And for good reason, according to various sources, the French banks have written losses on part of their loan to Casino in their accounts. This scenario has no consensus among Casino’s creditors who know very well that it would favor their competitors. “We know that Carrefour is watching,” adds a banking source.
The other option, softer, aims to forge an alliance in France, without forcing Jean-Charles Naouri to sell Casino. The group is in the process of bringing together its three flagship brands Monoprix, Franprix and CDiscount under the same “roof”. “The grouping of French activities makes it possible to bring a partner to raise money”, explains a close friend of the CEO. This scenario is being seriously studied by a French bank. “We are in talks with Casino about opening the shareholding in France,” confirms a source close to this lender who wishes to remain anonymous. This solution would make it possible to start a consolidation movement, inevitable in France, saving Jean-Charles Naouri who has built his empire for thirty years.
The 73-year-old chief executive has no internal heir and many of his lieutenants have left in recent months. His heritage was never discussed. It is also this taboo subject that his creditors want to put on the table to accelerate the restructuring of Casino.
Source: BFM TV
