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By Dominique Vidalon
PARIS, June 8 (Reuters) - French retailer Teract's majority shareholder InVivo is dropping plans to merge Teract with the French retail business of debt-laden supermarket chain Casino, financial newsletter "La Lettre A" said on Thursday.
Teract has been in exclusive talks since March to combine with Casino's French retail business.
The exclusivity period for the talks expires on June 8 and Teract has said it will issue a statement on Thursday evening.
Casino, Teract and InVivo declined comment on the report.
In a separate development regarding Casino, the newsletter also said that Teract backers entrepreneur Moez-Alexandre Zouari, tech billionaire Xavier Niel and investment banker Matthieu Pigasse, plan to set up an investment vehicle code-named "3F" (founders, friends & family) to raise funds with Casino's creditors.
Pigasse and Zouari did not immediately respond to requests for comment. Niel declined to comment.
Last month Casino, which is headed and controlled by veteran entrepreneur Jean-Charles Naouri and owns the Franprix and Monoprix chains, officially started court-backed negotiations with its creditors while weighing a tie-up proposal with Teract and another from Czech billionaire Daniel Kretinsky.
In April, Kretínsky, already Casino's second-largest shareholder, offered to take control of Casino through a 1.1 billion euro ($1.18 billion) capital increase, a move that would dilute Casino's boss Naouri and take control of the supermarket chain from him.
Kretinsky's proposal is backed by investor Marc Ladreit de Lacharrière, whose Fimalac group is now Casino’s third-largest shareholder.
Casino had a consolidated net debt of 6.4 billion euros at the end of last year. It faces 3 billion euros' worth of debt repayments in the next two years and the holding company through which Naouri controls the company is also heavily indebted.
Teract was established in 2022 through the merger of agri-food cooperative InVivo's retail business with an acquisition vehicle backed by Xavier Niel and Pigasse. It operates in the food and pet/garden sectors. ($1 = 0.9316 euros) (Reporting by Dominique Vidalon; additional reporting by Mathieu Rosemain and Gus Trompiz, Editing by Benoit Van Overstraeten and Susan Fenton)
