Jan 26, 2012
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Hopes of new CEO lift Carrefour shares

Jan 26, 2012

Carrefour (CARR.PA) shares surged 8 percent on Thursday amid mounting speculation that respected retail veteran Georges Plassat could soon replace Lars Olofsson at the helm of the troubled French retailer.

Georges Plassat

Plassat, chief executive of private-equity backed Vivarte, may replace Olofsson as CEO of Europe's largest stores group as early as this weekend, Linéaires magazine reported on its website, citing unnamed sources.

Carrefour and Vivarte declined to comment on the report.

"Plassat may be named Carrefour CEO this weekend, a much-needed management change," a Paris-based trader said.

Pressure has been building on Olofsson after a string of profit warnings, management defections and strategic U-turns last year.

A source told Reuters in November that Carrefour was looking for a new CEO and that Plassat had turned down the job. Carrefour, however, denied such a search was on.

Several sources familiar with the matter told Reuters this week that Plassat was still talking to Carrefour but that a key hurdle to his arrival was that he needed to negotiate the terms of his exit from Vivarte with his partners.

Vivarte is majority-owned by private equity group Charterhouse.

Plassat owns about 10 percent of Vivarte, a stake valued at about 100 million euros ($131.6 million), according to analysts.

Finding a CEO with the right profile to reassure Carrefour investors, boost staff morale and revive the world's second-largest retail group after Wal-Mart (WMT.N) is not easy, and credible candidates for the high-profile job have been scarce.

Plassat, who spent 15 years at French retailer Casino (CASP.PA) and two years at Carrefour Spain before heading to Vivarte in 2000, has the right profile to take on the Carrefour challenge, analysts and retail industry insiders say.

"The possible recruitment of Georges Plassat would send a strong signal to employees, suppliers, and investors," CM-CIC analyst Christian Devismes said.

Analysts point to his in-depth knowledge of both food and non-food retail and of Carrefour.

His experience at Vivarte, the owner of brands such as Andre shoes, Kookai womenswear and discount retailer La Halle aux Vetements, could be crucial in helping Carrefour boost lagging sales of non-food items in its hypermarkets, they say.

Plassat also has a track record in company restructuring, having participated in two consecutive leverage buyouts at Vivarte and a long experience in dealing with active shareholders.

This could prove handy in dealing with Carrefour's top shareholders Blue Capital, an alliance of France's richest man Bernard Arnault and property firm Colony Capital.

At 6:15 a.m. ET, Carrefour shares were up 8 percent at 18.25 euros, the biggest rise by a European blue-chip stock.

By Dominique Vidalon and Pascale Denis

(Editing by Mark Potter)

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