Casino Guichard-Perrachon Share Prices Surge

Shares of Casino Guichard-Perrachon soared following approval for a fundraising plan led by Czech billionaire Daniel Kretinsky by the Paris Commercial Court. This move brings the troubled French supermarket closer to reducing its debt burden.

Restructuring Progress

The group, with over 11,500 stores in France and Latin America, announced the appointment of three domestic firms by the court for overseeing the restructuring process. Casino anticipates the completion of this restructuring by March 27, barring any appeals from court-appointed administrators, worker representatives, or other involved parties.

Market Reaction

At 0815 GMT on Tuesday, Casino shares witnessed a 35% increase, reaching EUR0.67. Despite this boost, the stock remains down by over 14% since the beginning of the year.

Financial Challenges

Facing significant debt and declining market share in France, Casino had engaged in discussions with creditors to secure sufficient liquidity for sustained operations. In October last year, a consortium involving Kretinsky, banks, and creditors devised a strategy to strengthen the company’s financial position—a move that involved injecting new equity and slashing debt by 6.1 billion euros ($6.62 billion).

Shareholders’ Situation

The proposed plan includes a new equity injection of EUR1.20 billion, allocating EUR275 million for creditors and existing shareholders. Debt conversion into equity is also part of the deal. However, existing shareholders are expected to face substantial dilution, with their ownership reduced dramatically. Ultimately, Kretinsky’s consortium is set to acquire a majority stake in Casino, with current major shareholder Rallye Group holding a significantly reduced position.

Conclusion

The road ahead for Casino Guichard-Perrachon seems to be heading towards financial stability and debt reduction, thanks to the approved restructuring plan led by Daniel Kretinsky. As the company navigates through these changes, stakeholders will closely monitor the developments in the upcoming months.