SAO PAULO (Reuters) - France’s Casino (CASP.PA) hired Morgan Stanley & Co (MS.N) and JPMorgan Chase & Co (JPM.N) to list its global e-commerce platform spanning from Brazil to Thailand, a person familiar with the plan said on Tuesday, as the group faces competition from U.S. giant Amazon.com Inc (AMZN.O) and Chinese rival Alibaba IPO-ALIB.N.
Casino’s Brazilian subsidiary, GPA SA (PCAR4.SA), said in a securities filing that the group was preparing to combine the online units for a potential initial public offering in the United States. According to the source, who requested anonymity because the plans are private, the preference is for an IPO on the Nasdaq stock exchange.
The deal would bring new firepower to an e-commerce player with more than $4 billion in annual sales in France, Brazil, Colombia, Thailand and Vietnam at a time when major rivals are expanding their global reach. Shares of Casino rallied almost 3 percent to 91.68 euros in early Wednesday trading in Paris.
The French group, whose full name is Casino Guichard Perrachon & Cie, said that “a listing of the combined entity on the U.S. stock market, where many significant Internet technology players are listed, is being considered to speed up its development and boost visibility.” It did not mention any advisers for the IPO.
With the plan, Casino “is prioritizing management focus and alignment for execution over ownership and process simplification,” said Gustavo Oliveira, an analyst with UBS Securities. “This could drive global collaboration and best practices sharing, but tangible short-term revenues or synergies are almost non-existent.”
Amazon arrived in Brazil earlier this year with its Kindle e-reader, and eBay Inc (EBAY.O) and is launching a site in Portuguese this week for Brazilian consumers.
Chinese Internet powerhouse Alibaba Group Holding Ltd, which focuses in Brazil on business-to-business commerce, filed a prospectus on Tuesday for an IPO in the U.S. that is expected to raise upwards of $15 billion to expand its business.
The decision to list on the Nasdaq should help lure some of the world’s best technology investment firms into the plan, the source added. Morgan Stanley has had a leading role for years in underwriting major technology IPOs.
The decision comes after Casino undertook a deep restructuring of its Brazilian businesses following the departure of long-time partner Abilio Diniz from GPA less than a year ago.
GPA’s press office declined to comment on specifics of its plans. Casino officials in Brazil could not immediately be reached for comment. Media representatives for Morgan Stanley and J.P.Morgan in New York had no comment.
According to the filing, the transaction intends to combine Casino’s e-commerce assets into an international holding company initially known as NewCo, while seeking to maintain the efficiencies of its joint e-commerce and bricks-and-mortar business.
Nova Pontocom, the online unit of GPA, had about $2 billion in sales last year on websites serving the Brazilian market. Casino’s e-commerce division, Cdiscount, booked 2013 sales of about $2.1 billion in France and opened websites for Thailand, Vietnam and Colombia this year.
According to Marcel Moraes, a retail analyst with Deutsche Bank Securities in São Paulo, the deal “could potentially create value for shareholders of NewCo by sharing knowledge between the different platforms and, consequently, accelerating each region’s learning curve.” In addition, it would trigger large purchasing power by boosting scale.
Cdiscount, Casino’s e-commerce unit in France, has extensive expertise in private label products, techniques for sales conversion and in platforms for the market place, Deutsche Bank’s Moraes said.
According to the filing, GPA and its appliance unit Via Varejo SA (VVAR3.SA) created an independent committee to help the boards of both companies implement the plan and preserve the shareholders rights of the subsidiaries.
Veteran banker Eleazar de Carvalho Filho, Luiz Aranha do Lago and Maria Helena Santana, a former head of securities industry watchdog CVM, will oversee the committee, the filing added.
Reporting by Guillermo Parra-Bernal and Brad Haynes; Additional reporting by Gregory Blachier in Paris; Editing by Ken Wills and Sofina Mirza-Reid