French food giants duel over Brazil market
French food retail group Casino will do all it can to block a merger between its partner in Brazil and the Brazilian operations of archrival Carrefour, the world's second biggest retailer, a source said Monday.
"Casino is opposed to this merger and has the power to block the operation," a source said.
Brazilian investment fund Gama announced the venture with Carrefour earlier on Tuesday, backed by investment fund BTG Pactual and the Brazilian National Development Bank.
CBD Pao de Acucar (CBD), which is controlled by Casino and Brazil's Diniz family, is market leader in Brazil with a network of 1,647 stores and 13.7 billion euros ($19.6 billion) in sales in 2010.
Under the plan, Gama would take control of CBD and then merge it with Carrefour's Brazilian assets.
The source said that Casino will begin judicial procedures in Brazil in the coming days, arguing that the new entity would have a monopoly position in Rio de Janeiro and Sao Paulo.
© 2011 AFP