16 de septiembre de 2014 / 19:14 / en 3 años

Alibaba IPO timing bodes well for Casino's Cnova listing

SAO PAULO, Sept 16 (Reuters) - The frenzy around Alibaba Group Holding Inc’s initial public offering this week is giving a boost to Casino Guichard Perrachon & Cie’s plans to list its e-commerce unit in the United States by January, bankers and analysts said.

The Alibaba deal, which could fetch more than $22 billion, should add firepower to the listing of Cnova, Casino’s platform with over $4 billion in annual sales in France, Brazil, Colombia, Thailand and Vietnam, just as major rivals expand their global reach. Alibaba’s IPO is expected to price on Sept. 18.

The Cnova IPO is expected to happen between December and January, two sources with direct knowledge of the plan said. Analysts expect Cnova’s IPO to benefit from the earlier listings of Alibaba and Chinese rival JD.com Inc in May.

The decision to list Cnova on the Nasdaq will lure the world’s best technology investment firms into the trade, the first source said. The timing of Alibaba’s listing “couldn’t be better” for the Cnova transaction, the source added.

“This will naturally bring about a recycling of money. People will make money with the Alibaba IPO, then cash out some of the gains and buy into another case,” the second source said. “Many people are active because of Alibaba deal - it’s an anchor that will help lure more people” into trades like Cnova.

Both sources declined to be identified because of regulatory restrictions related to the IPO plan.

Zia Wigder, head of research of consultancy firm Forrester, said the Alibaba IPO poses no threat to other e-commerce IPOs, especially in countries where the Chinese giant is not dominant.


The Cnova IPO intends to combine Casino’s e-commerce assets into an international holding company while maintaining the efficiencies of its joint e-commerce and bricks-and-mortar business. According to Grupo BTG Pactual analysts led by Fabio Monteiro, shares of two Casino subsidiaries in Brazil - whose online businesses will be run by Cnova - could have relevant upside thanks to listing.

Considering sales equivalent to 1 time to 1.5 times enterprise value - a gauge that accounts for a company’s market capitalization plus debt minus cash - shares of supermarket chain GPA SA could rise up to 18 percent, and those of home appliance retailer Via Varejo SA up to 31 percent, Monteiro said.

Revenue at GPA’s online unit was $2 billion last year, while Casino’s e-commerce division, Cdiscount, booked 2013 sales of about $2.1 billion in France.

Monteiro expects Cnova to price its IPO at a discount to Chinese and U.S. peers since growth at Casino’s online operations is lagging behind. Cnova remains “well off the benchmark” Amazon.com Inc, and its marketplace business, a fee-based business with much higher returns and margins than e-commerce, because it is smaller relative to peers, he noted.

Amazon arrived in Brazil earlier this year with its Kindle e-reader, and eBay Inc is launching a site in Portuguese this week for Brazilian consumers. (Editing by Todd Benson and Bernard Orr)

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