French retailer Auchan to retain three of 18 Vietnam stores

Auchan Retail Vietnam Communications director Vu Thi Kim Nuong told VnExpress that three stores in Ho Chi Minh City would be retained, two in District 2 and one in Tan Binh District.

She did not provide a reason for keeping them, but Auchan Retail CEO Edgar Bonte told French newspaper Les Echos last week the company had decided to sell all 18 stores in Vietnam.

Nuong said the pullout was due to losses and Auchan Vietnam had not been able to come up with a suitable development strategy. The parent company is changing its policies and restructuring, and has decided to pull out of unprofitable markets.

"We are in the process of negotiating with a few retailers, so we cannot say anything at the moment," said a company spokesperson who did not wish to be named. "Negotiations are moving forward quickly, and are expected to end before Auchan withdraws from Vietnam early next month."

Because negotiations are still ongoing, what happens to these stores would depend on the buyer, the spokesperson said, without revealing who the suitors were.

The supermarket reportedly stopped buying from suppliers last Sunday, and will be offering discounts to liquidate stocks quickly.

Auchan’s decision to withdraw from Vietnam follows its deal earlier this week to sell almost all of Auchan Retail Italy to Conad, an Italian retail co-operative.

Auchan, which came to Vietnam in 2015, has 13 stores in HCMC, four in Hanoi and one in Tay Ninh north-west of HCMC, and employs around 1,000 people.

The supermarket chain had planned to invest $500 million and open 300 outlets in Vietnam, but stopped at 18 when business did not meet expectations.