Carrefour Brasil expanding hybrid wholesale, eyes real estate carve-out

SAO PAULO (Reuters) -Grupo Carrefour Brasil said on Tuesday it will accelerate the expansion of its hybrid wholesale stores in coming years while looking into a carve-out of its real estate business.

Splitting off its real estate assets could create one of Latin America's largest retail-focused property firms.

Shares in the company, formally called Atacadao SA, jumped as much as 5% after the announcement, making it one of the top gainers on Brazil's Bovespa stock index, which was nearly flat in morning trading.

The local unit of French retailer Carrefour SA said in a securities filing that the potential real estate business carve-out could be followed by the sale of a minority stake to a strategic investor.

Carrefour Real Estate currently includes more than 450 assets and as a separate company it would have more than 1.5 billion reais ($287 million) of net operating income, it added.

The move comes "in line with the group's strategy to unlock the value of its assets and to accelerate the development of its real estate," Carrefour Brasil said.

In a separate filing, the company said it expects to have a portfolio of 470 hybrid wholesale stores ("cash-and-carry") by 2026, accelerating openings to an average of more than 25 units a year from a pace of about 20 a year since 2018.

The decision follows plans for an expansion in its core businesses, the firm said.

The news came after Atacadao SA's French parent company, Europe's largest food retailer, earlier in the day disclosed its turnaround strategy amid soaring inflation, planning to open more discount stores and cut costs.

Analysts at JPMorgan said the group's strategic plan is positive for Carrefour Brasil, noting that its hybrid wholesale format has had the best performance in the industry and been a driver of growth for the Brazilian firm.

($1 = 5.2249 reais)

(Reporting by Gabriel Araujo; Editing by Steven Grattan and Susan Fenton)