December 26, 2018 / 11:34 AM / 6 months ago

Brazil's Via Varejo replaces CEO as turnaround effort accelerates

SAO PAULO, Dec 26 (Reuters) - The board of Brazilian electronics and appliance retailer Via Varejo SA has replaced recently appointed CEO Flavio Dias, the company said, as it tries to turn the page on a year of lukewarm results and rocky stock performance.

Taking Dias’ place, the board said in a securities filing, will be his predecessor, Peter Paul Estermann, who had served as CEO until February. Estermann has since served as CEO of food retailer GPA, which holds a major stake in Via Varejo, and will remain in that post parallel to running Via Varejo once again.

In the filing, the board said Estermann needed to bring about a quick improvement of Via Varejo’s profitability.

Both GPA and Via Varejo are ultimately controlled by French retailer Casino Guichard Perrachon SA, which has been trying to unload Via Varejo for almost two years in an effort to reduce its hefty debt load.

On Monday, GPA said it could sell its full stake in the appliance retailer through a block trade in the stock exchange by the end of 2019, if it does not find a strategic buyer.

The first step in this strategy will be the sale of a 3.86 percent stake in Via Varejo through a block trade on the Sao Paulo stock exchange on Dec. 27.

The food retailer said that while it is still looking for a “strategic investor”, it might sell its shares in the open market as an alternative, with the aim to liquidate its shares by the end of 2019.

Via Varejo recently migrated all its shares for a single, common class of stock listed in a higher corporate governance segment in the Sao Paulo stock exchange.

Brazil-listed shares in Via Varejo have tumbled 42 percent year-to-date, even while some of its e-commerce-heavy peers have registered significant gains.

Recent quarters have seen disappointing results as the company has struggled to integrate its online and offline channels and smoothly expand online operations.

“Via Varejo is accelerating the process of finalizing the measures that will allow the integration of all offline and online commercial operations,” the company said in the securities filing.

Reporting by Gram Slattery Editing by Mark Heinrich

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