The Casino Group has announced its intention to contribute part of its real estate assets in France to a dedicated subsidiary, which it is considering listing in the second half of 2005. The company will opt for the French SociÃ©tÃ© d'Investissement Immobilier CotÃ©e (SIIC) tax regime.
The assets to be transferred are mainly shopping malls adjacent to hyper- and supermarkets, as well as the real estate of cafeterias owned by the Casino Group. The Casino Group does not plan to contribute the real estate of the hyper- and supermarkets it operates, nor the warehouses and offices it owns.
The assets are spread over around 150 locations, and yielded gross rents of ca â¬ 65m in 2004, of which close to 80% were billed to non-Casino Group tenants.
The company will boast its own management team, financial resources and corporate governance allowing it to develop independently. Casino will retain a majority ownership in the company post IPO, thus giving the subsidiary privileged access to the Group's new shopping mall developments.
Upon completion of the project, the company will be positioned as a pure shopping mall play, allowing its shareholders to seize opportunities in the retail real estate market in an appropriate tax environment.
The proposed transaction lies within the scope of the new tax regulation regarding contributions of real estate assets to listed companies. It will provide Casino with a dedicated operating subsidiary in the strategic retail real estate market, and will both reduce the Group's indebtedness and increase its shareholders' equity.
The details of the transaction, as well as the precise timetable thereof, will be released at a later stage. They are subject to market conditions and to authorizations to be obtained from the relevant authorities, applications for which are ongoing.