A humble request from casino chief Jean-Charles Nouyrie

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Five years ago, Jean-Charles Naury had an opportunity to sell his French grocery empire, Casino, before collapsing under a mountain of debt.

US short seller Muddy Waters Research had already raised alarm bells about the indebted conglomerate’s opaque structures when Alexandre Bompard, chief executive of bigger casino rival Carrefour, suggested a merger in September 2018. According to people with knowledge of the meeting, Bompard was prepared to allow Nouri to become the largest shareholder in the merged group.

Nouri’s reaction was furious. The casino went public about this approach and said it rejected it. Carrefour was forced to clarify that no formal offer had been made. The move, people said, ended any possibility of a settlement.

Those who worked with him say that this episode was typical of Nouri, describing him as a man of brilliant mind blinded by increasing paranoia.

One person who worked with Nouri said, “Once the Muddy Waters attack happened, he lost all direction and sense of humor.” “He is extremely talented and crazy. , , He shut the door on the Carrefour deal almost immediately. He thought he could save the company by himself.

Since then the casino’s market share has declined and its share price has fallen from around €33 to €3 per share as the business is severely short of cash to operate. Now Naury’s 51 percent stake is set to be wiped out as part of a bailout led by Czech billionaire Daniel Kratinski.

The deal is expected to be finalized by the end of this month, closing a chapter in a decades-long saga that has stunned France’s business establishment, which for the first time united around one of its own .

The person who worked with him said, “The real story is how the business world of Paris has enabled him to last so long.” “He was highly respected in the business circles of Paris so the banks did not do their job. If he had not been so protected and treated with respect, the matter would never have dragged on for so long.”

Nouri “had the right approach”, said Clément Jeannelot, analyst at Brian Garnier. “He was among the first to believe in the rise of online retail. , , And to see that the large hypermarket formats were ruined. But . , , He was already constrained in terms of investment capacity.

Born in Algeria and raised by a single mother, Nouri gained admission to elite universities in France thanks to his talent for mathematics. There he rubbed shoulders with future leaders and captains of industry. He joined the administration under Socialist President François Mitterrand, where he masterminded reforms designed to liberalize France’s financial markets. His intellectual abilities impressed many.

Former Renault chairman Louis Schweitzer, who first met Nouri in government, said, “He is the most intelligent person I have ever met, really in a different category.”

After a stint at Rothschild, he acquired crisis-hit retailer Rally in 1991 and rivals Casino and Leader Price a few years later. Debt-based expansion began in Asia and Latin America.

Naori used the “Breton pulley”, a French financial technique adopted by other budding entrepreneurs including Vincent Bollore: it allowed him to control the casino with minimal capital through a group of holding companies.

But according to Jeannelot, the low-margin retail sector meant he was never able to reduce the group’s debt pile, preferring to reserve firepower for acquisitions instead.

It took an American to break the French omerta surrounding the faultline in the Kingdom of Nouri. Muddy Waters of short seller Carson Block targeted the casino in December 2015 after his hedge fund first disclosed its shortfall.

Nouri at first seemed to survive the attack, selling off the Asian operation and raising debt from banks and bond investors. But his influence on the group ultimately led to his downfall.

“The French banks were much more willing to ‘expand and show off’ than we expected,” Block told the FT this week.

Many in Nouri’s camp see Block’s attack as a cause of the casino’s financial woes, rather than a consequence. Without Muddy Waters, the casino “would not be in this financial state”, said a person with direct knowledge of Naori’s thinking. “Most people agree that the property is good. , , Smaller attacks were followed by suffocation which made it difficult to reanimate.

By 2019, the four holding companies above the casino, which had debt and derivative liabilities of more than €3.7 billion, were forced to file for the French pre-bankruptcy process, known as “protection”.

Casino critics have complained of being harassed or monitored: Block revealed in 2017 that a French corporate intelligence operative had disguised himself as a Wall Street Journal reporter in an attempt to uncover more information about its strategy. was presented In 2020, Kepler Cheuvreux told clients that Fabienne Caron, an analyst who wrote critical reports on the casino, had received “anonymous threat attempts”.

Caron, who has since left Kepler, declined to comment. Block said that he believed Nauori was behind these efforts. Nouri and the casino have denied the allegations.

For Block, the root of the businessman’s downfall was arrogance, which “manifested itself as a failure to manage risk.” They took financial risk as if they were immune to it,” he says.

The current restructuring talks have taken their toll on Nouri, whose wealth, estimated by Forbes in 2015 at $1.2 billion, has evaporated. A person close to him said the 74-year-old “does everything he can to keep the casino safe, seven days a week”. “It’s really about getting the casino to the right port.” Once all this was over, he could “take a sabbatical year, do some teaching, or start some other business”.

“He has been affected by all this,” said another person familiar with the conversation. “It’s his life’s work.”

Get free Jean-Charles Naury updates

we will send you one myFT Daily Digest Latest Email Rounding Jean-Charles Naury News every morning.

Five years ago, Jean-Charles Naury had an opportunity to sell his French grocery empire, Casino, before collapsing under a mountain of debt.

US short seller Muddy Waters Research had already raised alarm bells about the indebted conglomerate’s opaque structures when Alexandre Bompard, chief executive of bigger casino rival Carrefour, suggested a merger in September 2018. According to people with knowledge of the meeting, Bompard was prepared to allow Nouri to become the largest shareholder in the merged group.

Nouri’s reaction was furious. The casino went public about this approach and said it rejected it. Carrefour was forced to clarify that no formal offer had been made. The move, people said, ended any possibility of a settlement.

Those who worked with him say that this episode was typical of Nouri, describing him as a man of brilliant mind blinded by increasing paranoia.

One person who worked with Nouri said, “Once the Muddy Waters attack happened, he lost all direction and sense of humor.” “He is extremely talented and crazy. , , He shut the door on the Carrefour deal almost immediately. He thought he could save the company by himself.

Since then the casino’s market share has declined and its share price has fallen from around €33 to €3 per share as the business is severely short of cash to operate. Now Naury’s 51 percent stake is set to be wiped out as part of a bailout led by Czech billionaire Daniel Kratinski.

The deal is expected to be finalized by the end of this month, closing a chapter in a decades-long saga that has stunned France’s business establishment, which for the first time united around one of its own .

The person who worked with him said, “The real story is how the business world of Paris has enabled him to last so long.” “He was highly respected in the business circles of Paris so the banks did not do their job. If he had not been so protected and treated with respect, the matter would never have dragged on for so long.”

Nouri “had the right approach”, said Clément Jeannelot, analyst at Brian Garnier. “He was among the first to believe in the rise of online retail. , , And to see that the large hypermarket formats were ruined. But . , , He was already constrained in terms of investment capacity.

Born in Algeria and raised by a single mother, Nouri gained admission to elite universities in France thanks to his talent for mathematics. There he rubbed shoulders with future leaders and captains of industry. He joined the administration under Socialist President François Mitterrand, where he masterminded reforms designed to liberalize France’s financial markets. His intellectual abilities impressed many.

Former Renault chairman Louis Schweitzer, who first met Nouri in government, said, “He is the most intelligent person I have ever met, really in a different category.”

After a stint at Rothschild, he acquired crisis-hit retailer Rally in 1991 and rivals Casino and Leader Price a few years later. Debt-based expansion began in Asia and Latin America.

Naori used the “Breton pulley”, a French financial technique adopted by other budding entrepreneurs including Vincent Bollore: it allowed him to control the casino with minimal capital through a group of holding companies.

But according to Jeannelot, the low-margin retail sector meant he was never able to reduce the group’s debt pile, preferring to reserve firepower for acquisitions instead.

It took an American to break the French omerta surrounding the faultline in the Kingdom of Nouri. Muddy Waters of short seller Carson Block targeted the casino in December 2015 after his hedge fund first disclosed its shortfall.

Nouri at first seemed to survive the attack, selling off the Asian operation and raising debt from banks and bond investors. But his influence on the group ultimately led to his downfall.

“The French banks were much more willing to ‘expand and show off’ than we expected,” Block told the FT this week.

Many in Nouri’s camp see Block’s attack as a cause of the casino’s financial woes, rather than a consequence. Without Muddy Waters, the casino “would not be in this financial state”, said a person with direct knowledge of Naori’s thinking. “Most people agree that the property is good. , , Smaller attacks were followed by suffocation which made it difficult to reanimate.

By 2019, the four holding companies above the casino, which had debt and derivative liabilities of more than €3.7 billion, were forced to file for the French pre-bankruptcy process, known as “protection”.

Casino critics have complained of being harassed or monitored: Block revealed in 2017 that a French corporate intelligence operative had disguised himself as a Wall Street Journal reporter in an attempt to uncover more information about its strategy. was presented In 2020, Kepler Cheuvreux told clients that Fabienne Caron, an analyst who wrote critical reports on the casino, had received “anonymous threat attempts”.

Caron, who has since left Kepler, declined to comment. Block said that he believed Nauori was behind these efforts. Nouri and the casino have denied the allegations.

For Block, the root of the businessman’s downfall was arrogance, which “manifested itself as a failure to manage risk.” They took financial risk as if they were immune to it,” he says.

The current restructuring talks have taken their toll on Nouri, whose wealth, estimated by Forbes in 2015 at $1.2 billion, has evaporated. A person close to him said the 74-year-old “does everything he can to keep the casino safe, seven days a week”. “It’s really about getting the casino to the right port.” Once all this was over, he could “take a sabbatical year, do some teaching, or start some other business”.

“He has been affected by all this,” said another person familiar with the conversation. “It’s his life’s work.”