French retailer Casino could end up with control of the Argentine stores currently owned by Ahold subsidiary Disco after the Dutch group's preferred buyer, Cencosud, withdrew from negotiations.
Just before Christmas, Ahold announced that it had entered into exclusive negotiations with local businessman Francisco de Narvaez and Casino over the sale of its controlling stake in the Disco business.
Ahold is keen to sell its 237 Disco stores as it seeks to recover from the massive fraud which pushed it €1 billion into the red last year, and had originally designated Cencosud - the Chilean company which bought Ahold's Santa Isabel subsidiary there last year - as its preferred bidder.
But Cencosud failed to reach agreement with Ahold over the price within its 30-day exclusivity period, paving the way for the new talks with de Narvaez and Casino.
Ahold has not said how much it hopes to bank from the sale of Disco, nor has it given any details as to the nature of the joint bid, but analysts suggest that the asking price could be up to $350 million, with de Narvaez buying the business from Ahold and then selling part of it - as much as 40 per cent according to some reports - to Casino.
Casino, like its compatriots Carrefour and Auchan, has extensive operations in Latin America, but its footprint is far smaller than that of its main rivals. Its Argentine operations, for example, consist of 13 Libertad hypermarkets, 17 Leader Price discount stores, four cash & carries and 21 home furnishings/consumer electronics stores.
In contrast, Carrefour has more than 23 hypermarkets, 140 supermarkets and 255 hard discount stores there.