Less than a year after acquiring the Yeinot Bitan supermarket chain, Electra Consumer Products (TASE: ECP), of the Elco group, reported today that it had signed a memorandum of understanding (MOU) with French company Carrefour on the opening of a supermarket chain in Israel under the Carrefour brand.
Under the agreement, over 150 branches of the Yeinot Bitan chain will gradually be converted to Carrefour branches. The first branches under the Carrefour brand will be opened towards the end of 2022, while Carrefour's own brand products will start to be sold in Yeinot Bitan branches before the summer.
Carrefour is the largest international retailer to enter Israel. The company has some 13,900 branches and a sales turnover of €81.2 billion.
The franchise agreement between the parties is for twenty years, with the possibility of an extension for a further twenty years. The consideration for the franchise will be an initial down payment plus payments based on a proportion of revenue. The announcement said that the parties would work towards signing a binding agreement by April.
Patrick Lasfargues, president of Carrefour's international division, said, "We are happy to have signed this agreement, which once again demonstrates the robust foundations of Carrefour's international franchise strategy. Electra Consumer Products is a company with a strong spirit of retail entrepreneurship, which it again demonstrated when it bought Yeinot Bitan in 2021. We are sure that Carrefour's advent in Israel with help significantly in improving the local buying experience and will strengthen the purchasing power of the consumer, who will receive better products at more affordable prices."
Electra Consumer Products CEO Zvi Schwimmer said, "The entry of Carrefour into Israel is the biggest and most significant move ever in the history of retailing in Israel. As a leading global chain and as one of the largest food and consumer products producers in the world, Carrefour will enable Electra Consumer Products to lead the food and consumer products market in Israel and to enter new fields. Carrefour's advantages are consistent with Electra Consumer Products' strategy of giving added value to the customer and leading in every field that it enters."
Published by Globes, Israel business news - en.globes.co.il - on March 6, 2022.
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