French retailer Casino Guichard-Perrachon SA (EPA:CO) said today it had sealed a deal to buy Groupe Galeries Lafayette’s 50% stake in hypermarket chain venture Monoprix for EUR1.175bn (USD1.444bn).
The transaction, which is subject to regulatory approval, follows the signing of a letter of intent (LoI) on 28 June that ended a several months’ dispute between the joint venture partners over the price of Monoprix.
As part of the agreement, Galeries Lafayette has to sell its stake by 30 October 2013 and the two sides are to abandon the pending legal proceedings. Casino said last month that it had already agreed to the terms of a settlement agreement, which would allow Monoprix to grow under optimal conditions as part of the group.
Groupe Galeries Lafayette initially valued its stake at EUR1.95bn and later offered to sell it for EUR1.35bn or buy Casino’s holding for the same price. However, Casino rejected the offer as the bank that was advising it evaluated the stake at EUR700m.
When signing the LoI, the two sides said they would appoint Casino’s CEO Jean-Charles Naouri as board member of Monoprix and re-elect Philippe Houze as CEO of Monoprix. Upon completion of the deal, Casino will name a new chairman and CEO of Monoprix.