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  • France's latest takeover defense looks misguided.

  • Bruno Lemaire, the finance minister of France, has said that he is opposed to a $20 billion takeover off Car four by Canada's Coast Art.

  • So what's the problem?

  • Well, according to the mayor, it all comes down to jobs and food sovereignty.

  • So let's start off with jobs in a big $20 billion takeover like this.

  • The bigger party in this case could start, might be looking at Car four in order to push through so called synergies.

  • This'll often leads to job cuts, but this is a very unusual situation.

  • There's very little overlap in the businesses of Custard, which specializes in petrol station convenience stores, and Car four, which specializes in huge big supermarkets that are often seen throughout France.

  • So when it comes to food, sovereignty or supply chains, that is a more understandable concern.

  • During the pandemic, we saw empty shelves and low supplies of things like toilet paper and baby formula.

  • So it's understandable that a French finance minister would want to make sure that there are no shortages or that a company like Car four would be sure to use local suppliers to support the French economy, but he doesn't need to block the deal outright in order to achieve that.

  • If Emmanuel Macron's government were to introduce a law that meant that all supermarkets, not just Car four had to source a certain percentage of their goods locally, that may make all the difference.

  • Andi Custard could offer another promise to not cut any jobs.

  • But there is another interesting element of this deal.

  • Although the mayor is draping the tri color over Car four as a big French business, less than half of car force revenues last year came from France.

  • It's one of the biggest cash and carry operators in Brazil.

  • So while worrying about supply chains and jobs is understandable, he seems to be targeting the wrong enemy.

France's latest takeover defense looks misguided.

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    林宜悉 posted on 2021/01/15
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