(Bloomberg) -- Carrefour SA is forming a partnership with Chinese tech giant Tencent Holdings Ltd. and investing 2.8 billion euros ($3.4 billion) over five years in online shopping as Chief Executive Officer Alexandre Bompard seeks to fend off Amazon.com Inc.
A sweeping overhaul announced Tuesday will result in 2,400 job cuts at its French headquarters, the Boulogne-Billancourt, France-based retailer said in a statement. Carrefour plans to sell 273 former Dia stores and reduce the size of its sprawling French hypermarkets. The shares rose as much as 6.6 percent early Tuesday in Paris.
The company is seeking a boost at its struggling Chinese unit via partnerships with Tencent and grocer Yonghui. Carrefour said it targets cost savings of 2 billion euros on a cumulative basis by 2020. The retailer also said it aims to get one third of its sales from own-branded products and more than triple its revenue from organic food to 5 billion euros by 2022.
“We are currently grappling with a profound global movement,” the company said in a statement. “Our ways of consuming are changing: Quality, safety and where food comes from have become key concerns for our customers.”
Bompard came aboard in June from media and electronics retailer Fnac Darty SA, where he integrated online services and spearheaded the acquisition of appliance chain Darty. Carrefour’s profit has fallen two-thirds since its 2007 peak as online shopping and specialty stores eroded its sales of appliances and a price war erupted among French grocers. Carrefour had long been the leader in French supermarkets, but its market share slipped below that of closely held E. Leclerc last year, according to Kantar Worldpanel.
The job cuts will come from voluntary departures, Carrefour said. The company said it plans to streamline its online offerings in France with a single digital platform for generalist shopping, and will open 2,000 convenience stores in the next five years in major cities.
©2018 Bloomberg L.P.