2010 REGISTRATION DOCUMENT (3.4 Mo) - Groupe Casino

231 DECEMBER 2010Subsidiaries and AssociatesCompany Business % interestAsiaThailandBig C Group Retailing 63.2Indian OceanVindémiaRetailing (hypermarkets and supermarkets in Reunion, Madagascar, Mayotte,Mauritius and Vietnam).1002.3.4. SHAREHOLDERS PACTSThe Company is party to several shareholder pacts. Details of themain pacts are as follows:MonoprixOn 20 March 2003, Casino and Galeries Lafayette signed anagreement providing for the continuation of their partnership inMonoprix SA. The 25-year agreement was disclosed to the FrenchStock Exchange Authorities (Conseil des marchés financiers, avis CMFNo. 203C0223). It provides for the delisting of Monoprix (which tookplace in 2003) and gives each partner an equal number of seats onthe Monoprix Board of Directors, with the Chairman having a castingvote. The chairmanship rotates every three years, after an initialfive-year period during which Philippe Houzé, Chairman of GaleriesLafayette, continued to act as Chairman. Once Casino’s interest inMonoprix has been raised to 60%, these provisions will lapse. For aslong as Galeries Lafayette holds at least 40% of Monoprix’s capital, itwill have the right to veto any rebranding of Monoprix stores, as wellas any acquisition in excess of €80 million.Casino and Galeries Lafayette have exchanged put and call options,as described in note 32.2 to the consolidated financial statementsand note 16 to the parent company financial statements.The agreement also provides for the non-transferability of the sharesheld by each group, a reciprocal pre-emptive right, a joint exit rightand reciprocal call options in the event of a change of control.By amendment dated 22 December 2008, Casino and GaleriesLafayette agreed to suspend the exercise of their reciprocal calland put options on Monoprix shares for three years. Philippe Houzéremains Chairman of the Board of Directors for a term of three yearsuntil March 2012.Franprix/Leader PriceCall and/or put options have been granted on shares in a large numberof companies that are not wholly-owned by the Group. The optionsare exercisable for varying periods up to 2043 at a price based onthe operating profits of the companies concerned (see notes 28.4and 32.2 to the consolidated financial statements).Casino has also entered into shareholders’ pacts with some of itspartners.Following the Casino Group’s increase in its holdings in FranprixHolding and Leader Price Holding; the matching put and call optionsbetween the Baud family and the Casino Group were renewed in2004.However, in 2007, when Casino took over the operational managementof Franprix and Leader Price, the Baud family informed Casino thatthey contested the conditions of their replacement as managersof the business and that they intended to exercise their put optionearly. Given the terms of the shareholders’ agreement and theirmismanagement, the Casino Group refuted this position and theirright to early exercise of the put option. The arbitration board upheldthe Company’s position in a ruling delivered on 2 July 2009. Theboard ruled that Casino had acted legitimately in dismissing the Baudfamily members as managers and that, accordingly, the value of theremaining interests in Franprix and Leader Price held by the Baudfamily should be calculated in accordance with the option agreementson a multiple of 14 times the average 2006 and 2007 earnings of thetwo companies. Following this ruling, on 12 November 2009 GroupeCasino acquired the Baud family’s remaining interests in Franprix andLeader Price and now holds 100% of both companies.Almacenes Exito (Colombia)In July 1999, Casino entered into a strategic development agreementwith Almacenes Exito, whereby Casino acquired 25% of thiscompany’s share capital and became a benchmark strategic partner.In conjunction with the share acquisition, the two partners signed ashareholder pact setting out, amongst other things, their agreementconcerning the management of the company. The pact was amendedin October 2005, and between then and 31 December 2006, Casinoincreased its holding in Almacenes to 38.62%.On 16 January 2007, Casino exercised its right of first refusal overshares sold by one of the local partners and became the majorityshareholder on 3 May 2007.On 17 December 2007, Casino signed a new amendment to theExito shareholder pact to reflect the stronger relationship betweenCasino, the majority shareholder, and its strategic partners. Underthe new agreements, the partners have given up their put option,thereby releasing Casino from its commitment to purchase theirinterests in Exito. In addition, to take account of the new ownershipstructure, the revised shareholder pact contains new voting rulesfor appointing directors and for certain other decisions, as well asprovisions simplifying the rules on selling shares and other customaryclauses.Disco Uruguay group (Uruguay)In conjunction with Casino’s September 1998 acquisition of a stakein Grupo Disco del Uruguay, a shareholder pact was signed with thefounding families covering a period of five years, renewable once. Thepact sets out the basis for the exercise of joint control by the Casinoand the founding families over the business of the SupermercadosDisco del Uruguay subsidiary, with the two partners holding an equalnumber of seats on the Board. The pact expired in September 2008and the family shareholders continue to benefit from put optionsgranted by Casino, exercisable until 21 June 2021. These put optionsare described in note 16 to the parent company financial statementsand note 32.2 to the consolidated financial statements).28 Casino Group | Registration Document 2010