Target Company Overview

On July 30, 2020, Cerea Partners, through its Cerea Mezzanine III fund, made a sponsorship-free investment alongside Eric Chetail and his management team to enhance their control over the Cerise et Potiron group and embark on a new phase of development for the brand.

Founded in 1985, the Cerise et Potiron group is a prominent network of city-center grocery stores primarily focused on fruits and vegetables. Initially established under the Provifruits brand, the group was acquired in 1999 by its current leader, Eric Chetail, with the support of Prosol. Chetail initiated a strategic shift by launching the premium Cerise et Potiron brand, subsequently leveraging minority financial investors to accelerate growth, resulting in the establishment of nearly 40 new stores over the past decade. The group currently operates 63 stores and aims to maintain its development trajectory, highlighted by plans for four additional store openings by the end of the year.

Industry Overview in France

The food retail industry in France, particularly the fresh produce segment, has shown robust growth, driven by an increasing consumer preference for fresh and organic products. With rising health awareness, consumers are shifting from processed foods to fresh produce, which bodes well for city-center grocery stores like Cerise et Potiron.

Furthermore, the trend towards local sourcing has gained momentum, as consumers seek to support local businesses and minimize their carbon footprint. This shift aligns with the operational model of Cerise et Potiron, which focuses on providing high-quality, locally sourced fruits and vegetables in urban settings.

Additionally, the COVID-19 pandemic has accelerated changes in consumer behavior, leading to a surge in demand for grocery shopping experiences that prioritize safety and quality. As a result, grocery business formats emphasizing convenience and freshness have become increasingly attractive.

The French government has also been supporting the agri-food sector through various initiatives aimed at enhancing sustainability and innovation. These efforts create a conducive environment for growth within the sector, supporting the business model employed by companies like Cerise et Potiron.

Rationale Behind the Deal

The investment by Cerea Partners represents a strategic move to bolster the management's control and provide the necessary resources for further growth. The financing will facilitate the exit of minority shareholders who had entered in 2010 and allow the Group to pursue an ambitious expansion plan in a favorable market.

With the healthy performance of the fruit and vegetable market and increasing consumer preferences for city-center grocery formats, this deal aligns perfectly with future growth objectives. The decision also showcases Cerea's commitment to supporting sustainable agri-business initiatives, which resonates with the strategic direction of Cerise et Potiron.

Investor Information

Cerea Partners is a recognized specialist in the agri-food value chain, specifically through its mezzanine fund. The firm has a proven track record in financing growth in the food sector, providing flexible capital solutions to businesses seeking to expand in fast-changing markets.

By investing in Cerise et Potiron, Cerea Partners aims to leverage its expertise to enhance the company’s expansion strategy further. The firm has demonstrated a commitment to environmental and social governance, aligning with the values of the Cerise et Potiron Group.

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This investment presents a promising opportunity for both Cerea Partners and the Cerise et Potiron group. The company's strong market position and positive growth trajectory highlight its potential to thrive in the evolving retail landscape. With ongoing shifts towards health-conscious and sustainable consumer choices, the group is well-placed to capitalize on these trends.

Cerea's strategic support can facilitate the implementation of new growth initiatives, allowing Cerise et Potiron to enhance its market presence further. By focusing on expanding its store network and enriching its product offerings, the group is equipped to meet emerging consumer demands.

Moreover, the collaboration with Cerea Partners is likely to strengthen the company’s operational capabilities, given Cerea's expertise in agri-food investments. This partnership will allow Cerise et Potiron to navigate market challenges effectively and explore new opportunities for growth.

In conclusion, the investment by Cerea Partners is an excellent strategic fit, and with the right execution of their growth plan, Cerise et Potiron is poised for continued success, making it a worthwhile investment in the agri-food sector.

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