Colony’s European chief voted onto Carrefour board

Shareholders have approved the appointment of Sebastien Bazin to the supervisory board of Carrefour as Colony Capital challenges the company to sell off its real estate assets.

Carrefour, the second largest retailer in the world, has appointed two new directors to its board: Sebastien Bazin, the head of Colony Capital’s  European operations, and Nicolas Bazire, a representative of French billionaire Bernard Arnault.

Shareholders voted overwhelmingly in favor of the appointments at the company’s annual meeting in Paris, which observers hoped would shed light on plans to deal with Carrefour’s real estate holdings.

Through representation on the board, Colony and Arnault are hoping to influence events in their favor after spending €4 billion ($5.2 billion) purchasing 64 million shares in Carrefour, or 9.1 percent of the company, with the expressed intent of capitalizing on the company’s real estate.

Earlier this year, Los Angeles-based private equity real estate firm Colony bought the shares alongside Arnault, who owns French luxury goods company LVMH Moet Hennessy Louis Vuitton. The pair’s shareholding vehicle is called Blue Capital.

Colony Capital head Tom Barrack has reportedly said the French supermarket chain could earn approximately €30 billion by selling off its property assets.
However, Carrefour chief executive officer Jose Luis Duran says the property is worth no more than €20 billion, and at yesterday’s meeting insisted that maintaining control of property holdings was important to the company’s strategy, according to a report by the Associated Press.

Barrack maintains that the chain should sell and lease back its property in order to fund further expansion. As a shareholder, Colony has a track record of forcing real estate changes at large European groups, notably at Accor, in which it invested €1 billion in 2005. The French hotel group has since disposed of a significant amount of real estate.