France’s Casino puts Vietnam Big C chain on the block

Casino Group plans to unload the Big C hypermarket chain in Vietnam, as part of a restructuring plan to strengthen its financial flexibility in 2016.

In a news release posted on its website on Tuesday, the French group said it aims to shave off more than 2 billion euros ($2.17 billion) of debt. In addition to selling the Vietnamese Big C business, the company said it is mulling “real estate transactions in Thailand.”

Potential investors interested in buying the Big C operations include Thai conglomerates and Vietnamese property developer Vingroup, according to local sources. Bloomberg on Wednesday reported that the sale could raise 750 million euros, citing Bruno Monteyne, an analyst at Sanford C. Bernstein.

Brisk sales

Big C was one of the first international chains to gain a foothold in the Vietnamese market, where modern retailing is still in the early stages of development. The first of the French-style hypermarkets opened in the country back in 1998. As of December, the chain consists of 32 outlets and 10 C-Express convenience stores across Vietnam.

It is one of the top five retailers in Vietnam, with total sales in the first half of 2015 reaching 312 million euros, up 26.4% on the year.

Casino is the second European retail group to move to sell its Vietnamese chain of late. Last year, Germany’s Metro Group signed a deal to transfer its 19-store Metro Cash&Carry Vietnam unit to Thailand’s Berli Jucker for 655 million euros. The transaction was scheduled to be completed in the first half of 2015, but it has hit a legal snag related to Metro’s corporate income tax obligations in Vietnam.

Meanwhile, Casino Group is seeking to generate 550 million euros through the real estate business in Thailand, and another 200 million euros in Colombia, according to Bloomberg.

Casino’s Big C chain owns some 800,000 sq. meters of gross leasable area at shopping malls across central Thailand. In Colombia, its Exito unit controls more than 300,000 sq. meters of such space, excluding hypermarkets.

Casino entered Thailand in 1999, when it acquired a stake in Big C, the country’s No. 2 mass food retailer. The group is now Big C’s majority shareholder. Big C runs hypermarkets, supermarkets, convenience stores and supercenters — which combine a hypermarket and a large mall — in the Thai market.