Carrefour after Shufersal and Rami Levy: Acquires control of Free Market and enters wholesale sales
Global Retail, which operates Carrefour in Israel, has signed an agreement to acquire a 70% stake in the distributor Free Market at a valuation of 19 million shekels. The deal allows the retailer to enter the wholesale market for small businesses.
Carrefour is expanding its operations beyond the supermarket chain and entering the wholesale market for businesses. Calcalist has learned that Global Retail, which operates Carrefour in Israel, has signed an agreement to acquire 70% of the Free Market company at a valuation of 19 million shekels.
Free Market, owned by Nahum Bitan (50%) — who is himself one of the shareholders of Global Retail (22%) — Adom Group (45%), and Elad Vanunu (5%), specializes in the distribution and marketing of food products, toiletries, and cleaning supplies to mini-markets, grocery stores, and small businesses. The company currently distributes products from dozens of leading suppliers alongside imported goods, and the expansion of operations is expected to allow Carrefour to sell to food stores in kibbutzim and moshavim, nursing homes, offices, buffets, and other businesses.
The deal has additional strategic significance: Free Market has a logistics center covering 7,000 square meters in the Kfar Qasim industrial zone, near Rosh HaAyin, alongside a fleet of trucks, forklifts, and a full distribution infrastructure. Thus, Carrefour effectively receives a logistics center that it can use to expand parallel import activities, improve control over the supply chain to its branches, and collect distribution fees from suppliers who currently deliver goods directly to stores.
According to the agreement, Carrefour will purchase Bitan's entire stake and a portion of Adom Group's stake so that after the deal is completed, it will hold 70% of Free Market. Adom Group and Elad Vanunu will remain partners in the company. The deal is subject to approval by the Competition Authority.
Carrefour is not the first to identify the potential in this field. Shufersal was the pioneer when it established the Cash & Carry chain of stores for businesses back in 2018. Later, it acquired the distribution company Amiga, and in 2022, the company HaMefitz, which operates in the north of the country, while simultaneously creating a dedicated ordering site for businesses. The industry estimates that Shufersal's wholesale arm has a turnover of about 1.5 billion shekels per year. Rami Levy also entered the field in 2022, when he established the "Rami Levy for Business" chain alongside a dedicated sales site, and estimated at the time that within three years the activity would reach a turnover of about a billion shekels.
The advantage of food chains lies in their purchasing power with suppliers. They are able to purchase goods from them at attractive prices and market them to small businesses that large suppliers find unprofitable to serve directly due to low purchase volumes. For owners of grocery stores and small businesses, this means the possibility of consolidating an order from a wide range of suppliers, receiving one invoice, and enjoying uniform credit terms.
The industry estimates that the wholesale market for businesses turns over tens of billions of shekels per year. The bulk of the activity is directed at catering companies, hotels, restaurants, and nursing homes, alongside grocery stores, mini-markets, consumer cooperatives, and kiosks, as well as offices, companies, and public bodies. Acquiring control of Free Market gives Carrefour an immediate foothold in this market.
Carrefour's move comes just days after Inbal Harson took office as the company's CEO. The main challenge facing her is returning the chain to growth after same-store sales fell by 9.3% in the fourth quarter of last year. In the first quarter of this year, which benefited from high demand due to the timing of the Passover holiday and the war with Iran, the chain recorded an increase of only 2.4% in same-store sales — a rate lower than that of its competitors. Developing wholesale activity is expected to help increase sales. In addition, Carrefour recently won a Ministry of Defense tender for the supply of food worth about 35 million shekels per year for the ministry's hospitality lounges. The industry believes that Harson will also focus on expanding online activity and accelerating the operations of the company-owned Quick, which provides fast deliveries and competes with Wolt Market, which is up for sale.
