Intermarché Strikes Again: How Their Surprising Model Won Them Colruyt

“We are the most integrated group of independents,” an internal source explained. This means that, unlike Carrefour, the Intermarché stores are owned by the entrepreneurs themselves, highlighting their independent nature. However, unlike Leclerc, the Mousquetaires have a holding company (the Société les Mousquetaires), which is backed by its own capital, thus providing real operational capabilities at the group level. This “integrated” aspect enabled them to acquire the Casino stores, even at the cost of increasing their debt. In 2024, the financial debt of the Société les Mousquetaires reached 5 billion euros, up from 4 billion the previous year, and 3 billion in 2022.

For Colruyt, it was paradoxically the “independent” aspect that enabled Intermarché to prevail. Rather than taking on more debt for this 215 million euro transaction, while the group is trying to reduce its indebtedness, the Mousquetaires opted to have their members directly purchase the 81 stores. Thus, it is the entrepreneurs who took over these small stores who will individually bear the financial risk (averaging 2.6 million per store), and raise debt if necessary. This strategy aims to reassure the markets about the risks of the group’s over-indebtedness, even as it is in the process of closing 10% of the Casino stores it acquired, due to insufficient commercial dynamics. Will this be enough? “The arrival of Colruyt is like adding a rich dessert to an already heavy meal,” a former executive of the group quipped.

By the end of 2024, S&P Global Rating believed in the financial policy of the group, assigning it a moderate but good rating of BBB-, “mainly thanks to the solid financial position of the independents, which will strengthen the group’s solvency.” However, they warned: “We believe that the acquisition by the Société les Mousquetaires (SLM), largely financed through debt, of the 294 Casino stores, which will be transferred to the group’s members, presents significant execution risks since these stores have been under-invested until now, and SLM will bear a substantial portion of the restructuring costs. […] The negative outlook reflects the risk that SLM may not be able to maintain a ratio between its debt and its adjusted gross operating surplus of 3.5x or less […] in a context of still low volumes.” This will be the key challenge for the Mousquetaires in 2025, as they also prepare to sell nine of their factories: maintaining a reasonable level of debt while revitalizing the commercial dynamics of the Casino stores, and, to a lesser extent, the Colruyt stores, which are currently operating at a loss.