French retailer Casino’s shares slump 6% after S&P downgrade
PARIS (Reuters) -Shares in French retailer Casino fell more than 6% on Wednesday after Standard & Poor’s cut its long-term credit and placed all its ratings on credit watch, citing restructuring risk and weak liquidity.
With about 3 billion euros ($3.3 billion) of debt maturing in 2024 and 2025, Casino has been selling assets to meet repayment obligations.
The company, headed and controlled by veteran entrepreneur Jean-Charles Naouri, is striving to find a way out of its financial woes and is considering rival tie-up proposals.
Czech billionaire Daniel Kretinsky, Casino’s second-biggest shareholder, has offered to take control of Casino through a 1.1 billion euro capital increase, challenging a proposed tie-up between Casino and smaller retailer Teract.
Casino, which held its annual shareholders meeting on Wednesday, again declined to give an update on the two tie-up offers. It reiterated its pledge to reduce debt.
We believe the consent solicitation process, combined with the group’s weak operating performance, fragile liquidity position and unsustainable capital structure make a default, distressed exchange or redemption appear inevitable within six months, absent unanticipated and significantly favorable changes in the issuer’s circumstances,” S&P said in its statement.
($1 = 0.9084 euros)
(Reporting by Dominique Vidalon; Editing by Benoit Van Overstraeten, David Goodman and Jan Harvey)