Carrefour is reportedly looking into selling a minority stake in its business in China, and has already started speaking to potential buyers.
Sources told Reuters that the company is working with BNP Paribas on the deal. But when asked about a potential sale, a Carrefour spokeswoman said, “There is nothing particularly new to say about the matter.” BNP Paribas had no comment.
Earlier this month it was reported that the French retail giant was looking to fetch about $1 billion for the Chinese business.
Carrefour opened its first supermarket in Beijing in 1995, and now operates stores in more than 70 cities in the country. But net sales fell about 10 percent last year to 3.6 billion euros, despite Tencent Holdings and Yonghui Superstores taking a stake in Carrefour China last year. The three companies planned to collaborate on data, mobile payments and smart retail. But “alliances in China have slowed, rather than stopped the revenue decline,” Bloomberg intelligence analyst Charles Allen said in an April report.
In addition, the retailer is facing competition from online rivals, especially Amazon. As a result, Carrefour revealed plans last year to expand its eCommerce operations. In fact, Chief Executive Officer Alexandre Bompard announced plans to invest 2.8 billion euros ($3.4 billion USD) in eCommerce by 2022 — six times Carrefour’s current investment in its web operations.
“Carrefour has reached a turning point in its history,” he said at the time. “We have a huge ambition and I am well aware of the magnitude of this challenge.”
But Carrefour isn’t the only foreign retailer to have struggled in China. In 2013, Britain’s Tesco had to fold its Chinese business into a state-run company as a minority partner, while in 2016 retail giant Walmart sold its Chinese online grocery store in return for a stake in JD.com, which is the country’s second most popular eCommerce company.