France's PFH Group has completed an NIS 80 million investment in supermarket chain Carrefour Israel. Electra Consumer Products (TASE: ECP) yesterday notified the Tel Aviv Stock Exchange that the agreement was signed by PFH Group, which is owned by Simon Pinto and operates in logistics and real estate in France and Israel.
In addition, Electra Consumer Products, the controlling shareholder in Carrefour Israel, will invest NIS 86 million and Phoenix Holdings (PHOE) will invest NIS 14 million for equity in the supermarket chain. The total value of the deal is NIS 300 million (before money) with Carrefour Israel's equity expected to grow to NIS 270 million.
The transaction is subject to agreement by one of the two banking corporations that received an option in Carrefour Israel. One of the banking corporations has already granted its consent and the second bank is not expected to object. When the deal is completed Electra Consumer Products stake in Carrefour Israel will rise to 48%.
Pinto said, "I welcome the partnership with Carrefour, the leading international retail chain. I see this partnership as an opportunity to develop innovation and effective solutions for the supply chain and logistics and believe that the investment will yield over the near term processes that will benefit Israeli consumers."
Electra Consumer Products CEO Zvika Shwimmer said, "PFH is the leading international investment group in its field with rich experience in logistics and real estate. I am sure that the major experience and knowhow that they bring with them will contribute greatly to the future success of Carrefour Israel."
This week Carrefour opened three new stores in Israel in Tel Aviv, Givatayim and Ramla, bringing the total number of Carrefour stores in Israel to 86.
Swing to profit
Electra Consumer Products reported huge losses after the launch of the Carrefour chain in Israel in May 2023 after converting Mega and Yeinot Bitan branches at an investment of hundreds of millions of shekels. But by the third quarter of 2023 revenue rose 47% and net loss had narrowed to NIS 7 million from NIS 51 million in the third quarter of 2022. Most of the loss came from the 7 Eleven convenience stores opened by Electra Consumer Products for which it has the exclusive franchise in Israel. Electra Consumer Products forecasts that it would have swung to profit in the fourth quarter. The results will be published in March.
Published by Globes, Israel business news - en.globes.co.il - on February 29, 2024.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.