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Canada’s Couche-Tard drops $20 billion Carrefour takeover plan

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LONDON/PARIS (Reuters) – Canada‘s Alimentation Couche-Tard has dropped its 16.2 billion euro ($19.6 billion) bid to acquire European retailer Carrefour SA after the takeover plan ran into stiff opposition from the French government, two sources familiar with the matter told Reuters on Friday.

The decision to end merger talks came after a meeting on Friday between French Finance Minister Bruno Le Maire and Couche-Tard’s founder and chairman, Alain Bouchard, the sources said, speaking on condition of anonymity as the matter is confidential.

Couche-Tard and Carrefour declined to comment.

Earlier on Friday, France ruled out any sale of grocer Carrefour on food security grounds, prompting the Canadian firm and its allies to mount a last-ditch attempt to salvage the deal.

“Food security is strategic for our country so that’s why we don’t sell a big French retailer. My answer is extremely clear: we are not in favour of the deal. The no is polite but it’s a clear and final no,” Le Maire said.

Couche-Tard was hoping to win France’s blessing by offering commitments on jobs and France’s food supply chain as well as keeping the merged entity listed in both Paris and Toronto, with Carrefour boss Alexandre Bompard and his Couche-Tard counterpart Brian Hannasch leading it as co-CEOs, one of the sources said.

The plan also included a commitment to keep the new entity’s global strategic operations in France and having French nationals on its board, he said.

Couche-Tard was also going to pump in 3 billion euros of investments to the French retailer – a plan that was widely backed by Carrefour which employs 105,000 workers in France, its largest market, making it France’s biggest private-sector employer.

France’s opposition, with ministers shooting down the offer less than 24 hours after talks were confirmed, sparked disquiet in some business circles over how French President Emmanuel Macron decides which foreign investment is welcome and which is not.

Some politicians and bankers said the pushback could tarnish Macron’s pro-business image, while others highlighted that the COVID-19 crisis had forced more than one country to redefine its strategic national interests.

The comments sparked a trans-Atlantic flurry of lobbying and Couche-Tard’s Bouchard flew to Paris to explain the merits of the deal to Le Maire, the source said.

But the finance minister reiterated his opposition without listening to the terms of the transaction and said any such deal should not be revisited before France’s presidential elections in 2022, the sources said.

Couche-Tard initially explored the possibility of pursuing its offer despite the government’s stance on the deal, but later decided to raise the white flag and avoid a political storm, one of the sources added.

Canadian Prime Minister Justin Trudeau, asked about the prospects for a deal, said he would always be there to help Canadian firms succeed internationally and he spoke this week to Macron.

Carrefour launched a five-year overhaul plan in 2018 to cut costs and boost e-commerce investment to contend with online competitors as well as domestic rivals such as Leclerc. It has also expanded into convenience stores to reduce reliance on the big hypermarkets that still account for the bulk of its sales.

With food retailers across the world benefiting from surging demand as more consumers stay home during the COVID-19 pandemic, Carrefour reported robust third-quarter results in France as well as other key markets in Brazil and Spain.

CEO Bompard has repeatedly said the retail sector was bound to consolidate and that his mission was to ensure Carrefour emerges as a winner.

($1 = 0.8282 euro)

 

(Reporting by Pamela Barbaglia in London and Gwenaelle Barzic in Paris; Additional reporting by Allison Lampert in Montreal; Editing by Matthew Lewis)

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Canada says government fund helping to cut methane emissions

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By Nia Williams

CALGARY, Alberta (Reuters) – A Canadian government fund established to help the energy sector reduce methane emissions will cut the country’s overall carbon dioxide emissions by about half a percentage point in its first year, Natural Resources Minister Seamus O’Regan said on Friday.

The oil and gas sector is Canada‘s largest industrial emitter of methane, a potent climate-warming greenhouse gas that accounts for 13%, or 91 megatons, of the country‘s overall emissions.

In a news release, O’Regan said the C$750 million ($598.61 million) Emissions Reduction Fund would help the industry cut 3.1 megatons of carbon dioxide emissions in the 12 months since it was launched last October. That is the equivalent of taking 674,000 cars off the road.

Canada hopes the fund will spur the oil and gas sector to adopt greener technologies while also supporting energy jobs. The government has signed funding agreements totalling C$71.5 million with 15 companies so far, including privately-owned Tundra Oil & Gas Ltd in Manitoba.

“We have hundreds of thousands of workers who know how to build energy infrastructure,” O’Regan said. “These are the same people who will lower emissions, the same people who will build renewables, the same people who will meet our targets.”

Canada is the world’s fourth-largest oil producer and one of the biggest greenhouse gas emitters on a per capita basis.

Canadian Prime Minister Justin Trudeau’s Liberal government is aiming to cut carbon emissions from 730 megatons per year to 503 megatons by 2030, and has imposed measures including a carbon tax that will steadily ramp up to C$170 a ton.

Canada introduced national methane regulations in 2018, aimed at cutting emissions from the oil and gas sector by 40% to 45% and said in December it will establish new targets for 2030 and 2035. Data released last year, however, showed methane emissions from Canada‘s oil sector were higher than previously thought.

U.S. President Joe Biden’s administration also is planning to introduce stricter curbs on methane from the oil and gas industry.

($1 = 1.2529 Canadian dollars)

 

(Reporting by Nia Williams; Editing by Paul Simao)

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Canada extends travel restrictions at U.S. border

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By David Shepardson

WASHINGTON (Reuters) – U.S. land borders with Canada will remain closed to non-essential travel until at least April 21, the Canadian government said Thursday.

The new 30-day extension is the second announced under President Joe Biden and comes as U.S lawmakers in border states have urged lifting the nearly year-old restrictions to address the COVID-19 pandemic.

Canada has shown little interest in lifting the restrictions and last month imposed new COVID-19 testing requirements for some Canadians returning at and crossings.

 

(Reporting by David Shepardson; Editing by Chizu Nomiyama)

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Amazon Canada asked to shut Brampton facility on COVID-19 concerns

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By Chavi Mehta

(Reuters) – Amazon.com Inc‘s Canada division has been ordered to close its Brampton facility in southern Ontario, with workers being asked to self-isolate for 14 days, according to a statement from Peel Public Health on Friday.

Over the past few weeks, the rate of COVID-19 infection across Peel has been decreasing while the rate inside Amazon’s fulfillment center has been increasing significantly, according to Peel Public Health. (https://bit.ly/38uDnOn)

Amazon said it will appeal the decision, adding that the facility closure may have some short-term impact on its Canadian customers.

The company said that in its most recent round of mandatory testing in the facility, COVID-19 positive cases were less than 1%.

Peel Public Health said a current investigation determined high-risk exposure to COVID-19 for everyone working at the facility cannot be ruled out.

All employees will be required to self-isolate through March 27, unless they have tested positive in the last 90 days and completed their isolation period, the health agency said.

Last month, New York’s Attorney General Letitia James sued Amazon over its handling of worker safety issues related to the pandemic at two warehouses, a Staten Island fulfillment center and a Queens distribution center, both in New York City. (https://reut.rs/38Cm1iG)

 

(Reporting by Chavi Mehta in Bengaluru; Editing by Shounak Dasgupta)

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