Context

Casino, France's 7th largest food retailer (with a 6% share of the French supermarket market in 2023, according to Statista), has been facing persistent financial difficulties for several years. With over 50,000 employees in France and 200,000 worldwide, the group is struggling to get out of debt, posting a debt of 6.4 billion euros at the end of 2022, including 4.5 billion linked to its French business. Faced with this delicate situation, the group recently announced the sale of 288 of its Super and Géant stores to Auchan and Intermarché. This operation, valued at around 1.3 billion euros according to the press release issued by Casino, is a major event in the French retail sector.

Transaction details

The transaction involves the sale of 52 hypermarkets, 353 supermarkets, including 60 franchises, and 12 logistics warehouses. Retail giants Auchan and Intermarché jointly submitted an offer on November 29, 2023, amounting to around 1.3 billion euros, to acquire all these establishments. 

Intermarché plans to take over 4 hypermarkets and over 100 supermarkets, adding to its already extensive network and representing total sales of 1.2 billion euros. 

On the other hand, Auchan plans to acquire 48 hypermarkets and 32 supermarkets, valued at a combined turnover of 1.4 billion euros. It should be noted that Auchan is not taking over any stores in the Brittany region, where it is not present, a sign that it is essential for a retailer to capitalize on its geographical coverage.

Strategic interests

This operation marks a major step in the reconfiguration of the French retail landscape. The strategic interests behind this acquisition are clearly defined. For Intermarché, the aim is to overtake Carrefour in market share, which is number two on the French market, just behind Leclerc. According to Statista, Carrefour held 19.9% of the market share of food retail groups in France in December 2023, while Les Mousquetaires held 16.1%. The amortization of the industrial base, with its 56 AgroMousquetaires plants, is also a crucial issue, enabling Intermarché to strengthen its position in the agri-food sector. Finally, the possibility of recruiting new members or allowing managers to become associates via a pacte d'associés would broaden the base of players involved in the Intermarché network. (Source : LSA)

Auchan, for its part, sees this acquisition as a rare opportunity, perhaps the last for several decades, to achieve significant external growth in France, boosting its hypermarket estate, a key format in its portfolio. The transaction also aims to strengthen Auchan's presence in key regions, notably the South-East and Centre-East, where strategic expansion could guarantee better geographical coverage. Finally, the defense of the local offer and the promotion of national brands within the new stores will consolidate Auchan's position in the retail landscape.

How can all points of sale be adapted in such a short space of time? 

A crucial question then emerged: how to adapt all the outlets to the new owner's visual identity, all within a tight timeframe and budget?

As well as mobilizing almost the entire group to lend a hand in the field, Intermarché has the advantage of having implemented an innovative solution to meet this challenge. Retail VR's Retail Staging solution makes it possible to reproduce a physical store in a virtual one, thanks to 3D capture and modeling. In this new virtual environment, it is possible to test future concepts, and simulate new layouts, new signage positioning or a new assortment. This tool enables retailers to fit out new outlets in record time and within budget. On-site implementation is simplified, with 3D providing a better visualization of the project's final outcome.

Loic Le Du, Head of Concept - Cost Control and Infrastructure at Intermarché, gave us a testimonial on how the Retail Staging solution is helping Intermarché to improve decision-making processes and achieve budget savings. This innovative approach is part of the dynamic transformation of the retail sector, enabling the operational efficiency and flexibility crucial to remaining competitive.

Conclusion

In conclusion, the sale of Casino's Super and Géant stores to Auchan and Intermarché marks a major turning point in the French supermarket industry. The financial stakes are enormous, and expansion strategies are limited in a territory that already boasts 44,000 points of sale! The innovative solutions that retail chains may use or are using to adapt their outlets also underline the rapid evolution of this highly competitive sector.