Bloomberg — Casino Guichard-Perrachon SA raised 4.1 billion reais ($780 million) with the sale of another stake in Latin American subsidiary Assai as the French grocer seeks to reduce its debt load.
Casino said Friday it sold 254 million shares of Assai at 16 reais apiece, including an additional allotment, confirming an earlier Bloomberg report. That represents a discount of about 1.5% from Thursday’s close. Casino, which sold another stake in November, has been giving up control of the Brazilian wholesaler and its stake is now dropping to 11.7%.
Assai, which is formally known as Sendas Distribuidora SA, didn’t immediately reply to emailed requests looking for comment sent outside business hours.
The sale is Brazil’s first equity offering this year, with turmoil about the nation’s new government, high interest rates and surprise corporate meltdowns buffetting markets. Concerns about the US financial system this past week roiled global assets, adding more volatility.
Casino, meanwhile, has been divesting assets as investors grow increasingly concerned about the grocer’s financial leverage. The company is raising more the the $600 million originally envisaged from the sale.
The divestment “suggests that the French operating performance won’t be strong enough to generate sufficient cash, and points to the deconsolidation of its most attractive Latin American division,” Bloomberg Intelligence analyst Charles Allen wrote in a note.
The Brazilian stock market had last seen an equity offering in December, when G2D Investments Ltd raised 70 million reais in a sale of depositary receipts. A month earlier, Casino sold about 2.7 billion reais in Assai shares.
Banks running the deal were Banco BTG Pactual SA, Banco Bradesco BBI SA, Banco Itau BBA SA and JPMorgan Chase & Co. Goldman Sachs Group Inc., UBS BB Investment Bank, Citigroup Inc., Credit Suisse Group AG, Banco Safra SA and Banco Santander Brasil SA also helped on the sale.
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