The Autorité de la concurrence clears, subject to the divestiture of 11 stores, the acquisition of 200 former Casino group stores by the Intermarché group

Background
On 8 February 2024, Intermarché notified the Autorité de la concurrence of its plan to acquire 200 food retail stores operated under the Casino group banner[1].
To take account of the stores’ difficult economic situations, the Autorité granted the Intermarché group, at its request, a derogation from the suspensive effect of merger control[2]. In accordance with the applicable rules, this derogation, which enabled Intermarché to complete the transaction without waiting for the Autorité to issue its decision, was without prejudice to the final decision to be taken by the Autorité, which, at the end of its investigation and competitive analysis, could call into question certain acquisitions by considering that remedies were necessary in areas where there would be insufficient competition for consumers after the transaction.
After examining the transaction, the Autorité has cleared Intermarché to acquire control of the stores in question, subject to divesting 11 stores to competing banners in order to ensure that consumers have access to sufficient alternatives and can benefit from competition when buying mass-market products.
The examination of the transaction concerned stores other than the 61 stores operated under the Casino group banner whose acquisition by Intermarché was previously examined and cleared by the Autorité on 11 January 2024, subject to the divestiture of three stores that have already changed banners in Lons-le-Saunier (39), Plouaret (22) and Vals-près-le-Puy (43). The three stores were divested to the Carrefour group[3].
The parties to the transaction
Intermarché operates various banners in the food retail sector, including Intermarché, Netto (hard discount) and Les Comptoirs de la Bio.
Intermarché and the target stores are active in the downstream food retail markets. Intermarché is also a supplier, notably through its subsidiary Agromousquetaires, and a buyer in the markets for the supply of everyday consumer goods, where the target stores are also present as buyers.
The Autorité was able to rule out any competition concerns in the supply market
The Autorité considered that the transaction was not likely to significantly strengthen Intermarché’s purchasing power in the upstream markets for the supply of everyday consumer goods, given the low purchasing share of the former Casino group stores acquired by Intermarché. The Autorité also found that the transaction was not likely to place the parties’ suppliers in a situation of economic dependency[4].
Risks to competition to the detriment of local consumers identified in 11 local areas
However, at the end of its analysis, the Autorité concluded that the transaction was likely to hinder competition in the market for the retail distribution of food products in 11 catchment areas surrounding the former Casino group stores in Arc-lès-Gray (70), Bagnères-de-Luchon (17), Blanzac-lès-Matha (17), Boé (82), Charlieu (42), Lambesc (13), Lorgues (83), Revel (31), Solliès-Pont (83), Susville (38) and Valence-d’Agen (82).
The Autorité considered that in these areas, where Intermarché would significantly strengthen its market power following the transaction, there would be no credible and sufficient alternatives to Intermarché, to regulate is competitive behaviour. This situation risked leading, in particular, to a reduction in the diversity of the offering, to the detriment of consumers in the areas concerned.
Intermarché proposed commitments, consisting of the divestiture of 11 stores, to resolve the competition-related concerns identified, which the Autorité accepted
To address the risks to competition, Intermarché has undertaken to divest, to one or more competitors, the target stores or, in Lambesc, at its discretion, another store in its group. These commitments will ensure that a sufficient level of competition is maintained and that the interests of consumers are safeguarded in the markets concerned.
The stores concerned are the following:
Area | Address | Post code | Town | Pre-transaction banner | |
---|---|---|---|---|---|
1 | Arc-lès-Gray | Avenue Charles Couyba | 70100 | Arc-lès-Gray | Hyper Casino |
2 | Bagnères-de-Luchon | 43 avenue du Maréchal Foch | 31110 | Bagnères-de-Luchon | Casino |
3 | Blanzac-lès-Matha | 139 rue de Saint-Jean d’Angély | 17160 | Blanzac-lès-Matha | Casino |
4 | Boé | Route de Layrac | 47550 | Boé | Casino Hyper Frais |
5 | Charlieu | Chemin de la Montalay | 42190 | Charlieu | Hyper Casino |
6 | Lambesc* | 2 avenue Jean Monnet, ZAC Bertoire | 13410 | Lambesc | Casino |
3 route d’Aix | 13410 | Lambesc | Intermarché | ||
7 | Lorgues | Avenue de Toulon | 83510 | Lorgues | Casino |
8 | Revel | Chemin des Bordes | 31250 | Revel | Casino |
9 | Solliès-Pont | Centre commercial Midi Multiple, 389 ZA des Plantades | 83210 | Solliès-Pont | Casino |
10 | Susville | ZI de Villaret La Mure | 38350 | Susville | Casino |
11 | Valence-d’Agen | 44/44 bis boulevard Victor Guilhem | 82400 | Valence-d’Agen | Casino |
The Autorité will ensure that these commitments are correctly implemented, so as to maintain effective competition and the continued operation of the stores concerned
The proposed buyers will need to be approved by the Autorité, which will ensure that they are able to provide a credible food retailing alternative in each of these areas. The Autorité will ensure that the buyers have the skills and financial capacities to operate and develop the target stores on a long-term basis. The divestitures must include all the components required to maintain the viability of the business and include the staff employed in the stores concerned prior to their takeover by Intermarché.
Store divestitures do not mean store closures, but takeovers with a change of banner to avoid the risk of price rises and/or a reduced offering to the detriment of consumers
The commitments are intended to safeguard adequate local competition.
The aim is to allow a competitor to take over the stores and their activities in order to safeguard competition in the area concerned, thereby ensuring that consumers have a diversified offering in terms of prices and products. The store divestiture process is closely monitored by the Autorité in the months following the decision to clear the transaction. The party cleared to carry out the transaction must present to the Autorité buyers capable of ensuring a valid takeover and then providing effective competition. Once these buyers have been examined, the Autorité can issue an approval, which will clear the effective divestiture of the store in question.
The divestitures do not therefore entail the closure of the stores, but a takeover with a change of banner.
What is a derogation from the suspensive effect?
While the effective conclusion of a merger is subject to clearance by the Autorité de la concurrence, in certain exceptional circumstances, duly argued by the parties, the Autorité may grant a derogation enabling the parties to finalise part or all of the transaction without waiting for the clearance decision, in order to allow for the continuation of the business activities.
The granting of such a derogation is exceptional. A derogation may be granted in cases where the acquired business is experiencing significant difficulties, such as financial difficulties, which jeopardise its viability, as was the case here.
However, the granting of a derogation by the Autorité is without prejudice to the final decision taken at the end of the investigation, as the Autorité may impose remedies (e.g. divestitures) or even prohibit the transaction if it is detrimental to competition.
[1] Since the planned transaction was notified and after Intermarché informed the Autorité, several target stores have been transferred back to the Casino group or removed from the scope of the acquisition.
[2] Derogation granted under Article L. 430-4 of the French Commercial Code (Code de commerce) by letter dated 1 March 2024.
[3] Autorité decision 24-DCC-02 of 11 January 2024.
[4] As noted by the Autorité, prior to the planned transaction, Intermarché, Auchan and Casino entered into new alliances in 2024. The possible effects on competition of these purchasing alliances, which fall within the scope of Article L. 420-1 of the French Commercial Code (Code de commerce), did not fall within the scope of the examination of this transaction.
* In Lambesc, the new entity has undertaken to divest either of the two stores identified, at is discretion.
Decision 24-DCC-255 of 28 November 2024
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