Spain's Dia supermarket group sells French unit
Spanish discount supermarket group Dia announced Thursday it is selling its troubled French operations, which employ some 7,500 people in 900 stores.
Dia, the world's number three discount store operator, said it had already begun the process to sell its entire French division.
"After many months trying to improve the business in France we concluded the best option was to sell the entire operation," said Dia financial communications chief Lara Vadillo.
"We have launched a plan to sell those assets," she said, declining to name a price.
Dia said it had removed the French unit's performance from the group's adjusted earnings report for the first quarter of 2014.
"We took the decision to present our activities in France as discontinued as all the conditions to do so were met," Dia chief executive Ricardo Curras said in a statement.
"The resolution is aligned with our commitment to focus on our core markets and with the responsibility of identifying the best options for our shareholders, employees and franchisees."
Dia made the announcement as it reported underlying group net profit in the first quarter of this year surged by 9.7 percent from a year earlier to 40.1 million euros ($56 million), after excluding the French business. Net sales fell 2.1 percent to 2.14 billion euros.
French unions told AFP earlier that they had been informed of the company's "very vague" plans at an extraordinary meeting between management and staff representatives on Tuesday.
At the end of 2013, Dia, which was spun off from the French supermarket giant Carrefour two years earlier, had 7,328 stores in six countries -- Spain, Portugal, Argentina, Brazil, China and France.
The 2013 results showed Dia sales in France plunged 10.9 percent from the previous year.
© 2014 AFP