Casino Guichard Perrachon: To be followed today


The casino's new divestment plan is positive in terms of credit, but remains vague, Moodys said in a report published yesterday. The French distributor, who will be watching this weekend, announced last Tuesday to sell two billion euros in extra assets in France. A second phase of the plan, which will be added to the first phase that is already in the pipeline: 2.5 billion euros to be achieved by the first quarter of 2020, including 2.1 billion euros today.

"The sale of additional assets will help the group reduce its consolidated debt, which is positive for the credit, but the effects on the operational diversity and size of the group, as well as on the expected use of the products, remain for the group. & # 39; unknown moment & # 39 ;, says Vincent Gusdorf, Senior Credit Officer of Moody & # 39; s Vice President in a report.

So far, Casino has not indicated which assets it intends to sell. The following wave of divestments may relate to some core assets, since the group already has many of its related activities, the report says.

In addition to the € 2.5 billion asset disposal plan, Casino has had 55 deficit stores since the beginning of the year, including 15 hypermarkets out of a total of 122 on December 31, 2018.

For example, "the current EBIT of the year will increase by 52 million euros and bring back 233 million euros in products, which is positive for the credit".

Although the sale of new assets contributes to a reduction in the net financial debt, the agency notes that a reduction in scale and operational diversity could mitigate the positive effects on credit quality.

"Casino's position as the fourth largest French distributor and its position as co-leader in the Brazilian food market are the main pillars for the quality of its creditworthiness," says Vincent Gusdorf.

He also notes that any transaction whereby new minority interests are created or value transferred to shareholders would also be negative in terms of creditworthiness.

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