Carrefour has entered into an agreement with Dairy Farm to acquire Wellcome Taiwan, consolidating its position as the leading multi-format food retailer in that market.
The transaction involves 224 proximity stores in quality locations (199 Wellcome - average sales area of 420 sq. m - and 25 Jasons - average sales area of 820 sq. m) as well as a warehouse (including ownership of the real estate and land). The transaction’s enterprise value is 97 million euros1. Wellcome Taiwan posted net sales of around 390 million euros in 2019.
By combining these businesses, customers and team members will benefit from the group’s greater strength and scale. Thus, the quality, prices, and service offered to Taiwanese consumers could be improved.
This acquisition, carried out under attractive conditions, allows Carrefour to accelerate its development in Taiwan in the fast-growing proximity format. Carrefour will thus become the local number 2 in this format.
Carrefour currently operates 137 stores in Taiwan, including 69 proximity stores under the Market banner. The Group posted net sales in the country of 1,968 million euros, EBITDA of 209 million euros and recurring operating income of 83 million euros in 2019.
Carrefour plans to convert the Wellcome stores to the Market banner within 12 months after the closing of the transaction, and then convert Jasons stores to a Carrefour premium banner. The converted stores will benefit from Carrefour’s commercial policy and purchasing conditions. The Group thus plans to improve commercial density and optimize the cost structure.
In addition, Wellcome will bring its recognized expertise in fresh produce and will contribute to the development of food e-commerce, each store becoming a new pick-up point for e-commerce orders. The transaction is subject to customary conditions and is expected to close by end-2020.