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Carrefour Plans to Sell Japan Stores

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Carrefour Plans to Sell Japan Stores; Divestiture Could Raise As Much as $400 Million Amid Difficulties in Europe

Robert Guy Matthews and Jason Singer. Wall Street Journal. (Eastern edition). New York, N.Y.: Oct 12, 2004. pg. A.3

Abstract (Summary)

The Carrefour Japan stores could fetch as much as $400 million, including the huge parcels of real estate occupied by Carrefour's hypermarkets -- sprawling stores selling a wide array of groceries and general merchandise -- according to people close to the retailer. Carrefour Japan Co., which opened its first shop in late 2000, operates eight stores in several cities in Japan, the world's No. 2 retail market.

In anticipation of an earnings warning from Carrefour, several analysts have reduced their estimates for Carrefour's results for the current fiscal year ending Jan. 31, 2005. Carrefour, which has 6,067 stores, had $87.35 billion in sales and $2.04 billion in net income for the last fiscal year ended Jan. 31, 2004. In the current year's second quarter, Carrefour's sales world-wide totaled 19.78 billion euros, up 0.8% from a year earlier. While sales in France fell 1.4% to 9.8 billion euros, sales in the rest of Europe rose 2.6% to 7.3 billion euros.

Carrefour earns half of its sales in France, even though it operates in more than 29 countries. Mr. Bernard said last month that the company was cutting prices and clawing back market share in France to compete better with discounters. Carrefour had been losing market share as it battled a price war and was stymied by French regulations that blocked expansion. Those regulations are no longer in effect, allowing Carrefour to expand once again.

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Copyright (c) 2004, Dow Jones & Company Inc. Reproduced with permission of copyright owner. Further reproduction or distribution is prohibited without permission.

Carrefour SA is planning to sell its operations in Japan in an effort to generate cash as the world's second-largest retailer faces a continuing sales slump and increased competition in Europe.

The Carrefour Japan stores could fetch as much as $400 million, including the huge parcels of real estate occupied by Carrefour's hypermarkets -- sprawling stores selling a wide array of groceries and general merchandise -- according to people close to the retailer. Carrefour Japan Co., which opened its first shop in late 2000, operates eight stores in several cities in Japan, the world's No. 2 retail market.

Meanwhile, slow August and September sales in Europe and especially in France, Carrefour's largest market, are expected to prompt the Paris-based company to warn that it expects

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