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Exclusive Interview - Alain Bouchard, founding president of the Canadian distributor, and Brian Hannasch, CEO of the group, explain why they have not given up on buying the French giant.

LE FIGARO. - Couche-Tard is primarily present in gas stations and convenience stores in North America. Why take an interest in Carrefour, whose store formats and geographic locations are far from yours?

Alain BOUCHARD. - When I was younger, I ran supermarkets before I went to convenience stores and then gas stations. Twenty years ago, I told my associates that we had to diversify into supermarkets. But we decided not to go because there were still a lot of opportunities in our core business. We will continue our acquisition strategy. But if you find opportunities around 100 stores, it is more difficult to find sets of several thousand. It is therefore time to add another axis of growth to our group, with a major acquisition in the supermarkets and convenience stores sector. We chose Carrefour for its exposure to numerous markets, in France, in other European countries and in Brazil. We visited stores and were impressed with its very solid model. We can make it grow even more. Carrefour is under pressure in France and needs huge investments that it cannot make alone. Alexandre Bompard needs additional resources to accelerate his plan.

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What was your project with Carrefour?

A. B. - Our plan was to make Carrefour a base of excellence to consolidate the market. Globally, mass distribution needs to be consolidated. Carrefour and Ahold Delhaize are the only groups present in both Europe and America.

Brian HANNASCH. - In France too, there are too many distributors, not to mention hard-discounters and Amazon. We would not have continued with consolidation right away. First, we would have learned to work with the Carrefour teams. It would have taken two or three years for our debt to go down. Then we would have resumed acquisitions in the world. We already have targets.

Casino is also present on two continents. You met its CFO this fall. Have you proposed a merger with this group, less dependent on hypermarkets?

A. B. - When you are a buyer, you need a seller ...

B. H. - I really like the Monoprix format and their presence in Brazil. But Carrefour has a larger geographical presence, and Casino is mainly present in France and Brazil. We really like Alexandre Bompard's plan, his omnichannel approach backed by 8,000 convenience stores, his focus on organic, home delivery and e-commerce.

You proposed to invest 3 billion euros in Carrefour. Were you ready to invest in French hypermarkets as well?

B. H. - We can help Carrefour to further modernize its French assets, for the benefit of the employees who work there and the customers who come there.

A. B. - We would have arrived with a new eye. We have identified huge opportunities to add value to Carrefour.

Bruno Le Maire vetoed your project even before receiving you, and without giving you time to develop your arguments. Do you feel that you have been mistreated by the French government?

A. B. - Politicians sometimes find it difficult to accept major changes in their country. We underestimated this. We thought the French government was encouraging foreign investment in France and hope that is still the case. The Bloomberg agency leak came too soon. We still had to negotiate a few days with Carrefour.

B. H.- We were very close to having an agreement on the principles of the operation, we obviously had a positive reception from the Carrefour administrators informed of the negotiations. Meeting the French government was of course the immediate next step.

Were you upset by the argument of the threat your takeover of Carrefour would pose to the food security of the French and to the agricultural world of our country?

A. B. - This is not a valid argument. I don't see how we could have been a threat. In my opinion, the decision of the French government is mainly linked to the pandemic.

B. H. - Our project was, on the contrary, to strengthen ties with French farmers and food manufacturers. Growing up on a farm in the Midwest, I am aware of these concerns. Offering empty shelves, not supporting local farmers, is not the best way to be a good distributor! We respect the government's position, but we still believe in this project. If one day the political situation changes, we are ready to re-engage.

Are you prepared to wait until after the presidential election, in May 2022, to buy Carrefour?

B. H. - Carrefour is at the top of the list of companies that interest us, but it is not the only one that would allow us to create a global player. By then, we may have moved on.

A. B. - We are not going to stop looking at the possible opportunities. 2022 may be a bit far away. We will see where we are in two years, and if there is an opening before.

How do you convince that consolidation is not a threat?

A. B. - This is not a threat, it is a response to a problem. Carrefour is under pressure, Couche-Tard is under pressure. We are taking initiatives to face it, but you have to be powerful, have the capacity to invest in order to defend yourself and win. The day Amazon bought Whole Foods, shares of distributors plummeted around the world, billions of dollars evaporated. To operate in this environment, you need to have a plan, and to implement that plan, you need money. Those who are unable to invest are in danger.

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Experts assure that the salvation of food distributors depends on their digitization and their shift towards e-commerce.

B. H. - The future of food retailing is not e-commerce, it is omnichannel. Good distributors are those who are successful in meeting the needs of their customers.

A. B. - I believe a lot in the proximity and the freshness of the products. You are more likely to gain the trust of consumers if you have stores in the city center than if you have a giant warehouse in the Paris suburbs.

What are you looking for with the partnerships being studied between Couche-Tard and Carrefour?

B. H. - We have set up a small team on the Couche-Tard side, and another on the Carrefour side, which will work together for the next forty-five days on four partnership projects. We will see if it is possible to create value for our two companies. Either way, we'll go ahead.