MONTREAL (Reuters) – Alimentation Couche-Tard would revive its $20 billion bid for France’s Carrefour if the Canadian convenience store operator saw a change in the French government’s stance on the proposal deal, its chief executive said on Monday.
Couche-Tard dropped its surprise bid for the European retailer over the weekend after the plan ran into opposition from the French government. Some French politicians said the issue was a matter of national food safety.
“We’d love to do the transaction …. if we got signals that the environment could change or would change from the French government or other key stakeholders,” Brian Hannasch told an analyst call.
News of the approach from Couche-Tard, which operates convenience outlets and fuel stations, broke only last week but unravelled swiftly in the face of opposition from French politicians including finance minister Bruno Le Maire.
With a deal effectively blocked, the companies said they had decided instead to examine opportunities for sharing practices on fuel purchases, partnering on private labels and distribution in overlapping networks.
Shares in Carrefour slumped more than 6% in Paris to 15.55 euros on Monday afternoon as the prospect of the 20 euro per share offer evaporated, for now at least. Couche-Tard shares rose 3.4%.
“In terms of politics, I think we went into this with eyes wide open knowing that this was a risk, and I certainly do believe that the pandemic has heightened the food security issue, particularly in France,” Hannasch said.
“And so whether that changes over time, it’s hard to say.”
Analysts at investment bank Citi said there was still a chance Carrefour and Couche-Tard could revive talks at a later date, while the possibility remained for Carrefour and domestic rival Casino to examine a merger deal.
“That said, the language and actions of Carrefour and Alimentation Couche-Tard suggest to us the parties would re-engage given even the slightest encouragement, whether now or in the medium term,” they wrote.
“Moreover, we continue to wonder whether the dalliance with Alimentation Couche-Tard might lead Carrefour and Casino Groupe to reconsider a merger as an alternative, driving both domestic and Latam synergies.”
(Reporting by Allison Lampert in Montreal, Noor Zainab Hussain in Bengaluru and Sudip Kar-Gupta in Paris. Editing by Mark Potter)
