2013
Management Change
Gonzalo Restrepo López, who performed the position of Chief Executive Officer of Almacenes Éxito S.A. during 22 years, announced on Fe- bruary 19, 2013 his decision to retire from the company to dedícate himself to his family, as well as to other activities for the benefit of the coun- try’s economic development. This decision was effective as of March 19, 2013, the date when the Ordinary Shareholders’ Meeting was held.
Consequently, and after a transition pro- cess, the Board of Directors of Almacenes Éxito S.A. appointed Carlos Mario Giraldo Moreno as the company’s New Chief Executive Officer, who in the last five years has been performing the position of Chief Operating Officer.
Reaffirmed again the legality of the merger
The Medellín Superior Court resolved in favor of Almacenes Éxito S.A. the appeal filed within the process initiated by former minority sha- reholders of Gran Cadena de Almacenes Co- lombianos S.A “Cadenalco S.A”. where the De- claration of Inefficiency was pursued regarding all the acts carried out once Almacenes Éxito S.A. assumed the shareholding control of said company, including the merger between both companies.
This decision finalizes the discussion on the acquisition and subsequent merger with Cadenalco S.A.
Ordinary shareholders’ meeting
The ordinary shareholders’ meeting was held on March 19, 2013, where the following propo- sitions were approved:
1. A dividend to be distributed among the sha- reholders, equivalent to COP$132.75 per
share, quarterly paid in April, July and Octo- ber 2013 and January 2014.
2. Approval of the strategy and action plan for the conversión to the international financial reporting standards (IFRS).
3. Management Report submitted by the Board of Directors and the President of the Company, as well as the financial sta- tements for the year ended December 31, 2012, together with the respective notes. 4. Appropriations to make donations du-
ring the period 2013 – 2014, equivalent to COP$2,714 million.
Acquisition of “La Cabaña”, in Uruguay
Almacenes Éxito S.A, through its subsidiary Grupo Disco de Uruguay, acquired “La Ca- baña”, the sales leader supermarket in the Uruguayan coast with sales of approximately COP$16 million dollars per year, being the first acquisition made after the penetration in the country in 2011.
Increase of the participation in Lanin S.A.
Almacenes Éxito S.A increased its investment by 0.13% in the Uruguayan company Lanin S.A., operator of the Devoto Brand in Uruguay, thereby consolidating a shareholding participa- tion of 96.68% in the company’s shareholding through its subsidiary Spice Investments Mer- cosur S.A.
Launching the Aliados Surtimax program
The company presented its program Aliados Surtimax, a business model based on a colla- boration agreement that provides the opportu- nity to independent traders to develop their bu- sinesses together with Grupo Éxito. At the 2013 close, 272 businesses of those characteristics had entered that model of alliance.
Opening of Centro Comercial VIVA Sincelejo
In November 2013, Almacenes Éxito S.A. ope- ned its second Commercial Shopping Mall under its “VIVA” brand developed in alliance with “Con- concreto” with a participation of 51%. The new Commercial Shopping Mall “VIVA Sincelejo”, has an Exito hypermarket as anchor store and a Fla- mingo store. New recognized national and inter- national brands offer their products and services in 123 business premises with an extensive offer of restaurants, banks and clothing.
Project generalities
GLA (leasing area): approximately 0.712 m² (in- cluding the Éxito anchor store)
Quantity of business premises: 123
Investment of Grupo Exito: COP$75,556 million.
Launching of Móvil Éxito
The launching of Móvil Éxito was made, which is a new business that offers mobile telephony services focused on its clients, who now may redeem Points for minutes or other products of Móvil Éxito telephony. This service is managed by Colombia Móvil S.A. E.S.P. “TIGO”.
Éxito Viajes y Turismo S.A.S.
This company was formed on May 30, 2013 in accordance with Colombian laws, which corpo- rate purpose is the exploitation of the activities related with the tourism, as well as the touristic representation and the establishment of travel agencies in any of their modes and the promo- tion of national and international tourism.
Acquisition of Gemex O & W S.A.S.
Almacenes Éxito S.A acquired 85% of the sha- reholding capital of Gemex O & W S.A.S., an entity domiciled in Medellín which corporate
purpose is the sale of goods through alternate sale channels, such as catalogue direct sale.
Acquisition of commercial establishments owned by Cafam
The company signed a new Agreement with Caja de Compensación Familiar Cafam whe- reby title is consolidated in the name of Alma- cenes Éxito S.A. of the 29 commercial esta- blishments which were owned by this Family Subsidy Entity and that up to now and after an alliance of 15 years signed in 2010, the com- pany had been operating.
2012
Cativén S.A.On December 10, 2012, it was informed to the market that the Company had received the pay- ment of US$18.1 million corresponding to the last installment of the shares in the company Cade- na de Tiendas Venezolanas S.A. – Cativén S.A., equivalent to 28.62% of such company capital.
The provision for accounts receivable set up for the operation was reversed upon the credit of the last installment.
Investment in Subsidiaries of Grupo Casino
The General Shareholders’ Meeting at an ex- traordinary meeting held on December 13, 2012 approved a proposition relating with ge- nerating an option for the diversification of the handling of a part of the Company’s excess of li- quidity by means of the acquisition of short term bonds (“The Bonds”), issued by a subsidiary of Casino Guichard Perrachon (“Grupo Casino”), dedicated to the management of cash within the Grupo Casino.
By means of this mechanism an additional alternative would be generated to invest tem- porarily part of the resources available of Al- macenes Éxito S.A., complementing its current investment alternatives in financial entities.
It is worth noting that in order to ensure liqui- dity for Almacenes Éxito S.A., the Grupo Casino has offered a liquidity guarantee under which it should acquire the bonds at any time and without any condition, if Almacenes Éxito S.A. so requires.
The investment in bonds will take place un- der the assumption that the net return is equal or higher than the average of the net return granted by the current investments of the Grupo Éxito through the principal banks in Colombia.
In accordance with article 23 of Law 222 of 1995 and the Decree 1925 of 2009, as well as with the Company’s Good Government Code, the transaction was subject to the consideration of the General Shareholders’ Meeting since this is a transaction between related parties which implementation corresponds to the Board of Di- rectors, where members which are in turn em- ployees of the Grupo Casino participate.
Opening of a Centro Comercial under the “VIVA” brand
Almacenes Éxito S.A. opened its first Centro Comercial under its “VIVA” brand, developed in Alliance with the firm having an Antioquia origin “Arquitectura & Concreto”, the new Centro Co- mercial “VIVA Laureles” has as anchor store an Exito Hypermarket – the fourth in sales of the organization – which has operated since 1997. New and recognized national and international brands offer in 86 commercial premises their products and services with a wide offer of res- taurants, banks and clothing.
This real-estate project is the first one in its class and was constructed in line with the expansion plan of the company of openings in several principal and intermediate cities of Colombia.
Generalities of the project
GLA (área feasible of being leased): approxima- tely 20.500 m² ( including the anchor store Éxito) Number of commercial premises: 86
Investment of Grupo Exito: COP$93,000 million.
VIVA Villavicencio
The Company and Grupo Argos S.A. (“Argos”) agreed on investment and development condi- tions of a real-estate project fort the city of Villa- vicencio, denominated Centro Comercial VIVA Villavicencio (“The Project”).
In “The Project”, the Company holds the capacity of promoter, developer, administrator and investor with a participation of 51% thereof and Grupo Argos will have the capacity of in- vestor with a participation equivalent to 49%.
The total investment for the develop- ment of “The Project” will be of approxima- tely COP$213,000, in respect of which the Company will make an estimated contribution of COP$109,000 and the Grupo Argos of COP$104,000.
Almacenes Éxito S.A. will contribute with 54 of the 58 commercial premises making up the Centro Comercial La Sabana – Propiedad Ho- rizontal, located in calle 7 N° 45 – 185 of the Municipality of Villavicencio in the Department of Meta, which represent 90.05% of the coeffi- cients of the co-ownership and a lot for future development inside the stated Centro Comer- cial. These contributions in kind are valued for a sum equivalent to COP$63,000, which will be complemented with a capital contribution of approximately COP$46,000.
The Centro Comercial Viva Villavicencio will have approximately 159 commercial pre- mises and 1.569 parking sites. It will open its doors in the second half of 2014, in the place where El Centro Comercial La Sabana currently operates.
Note 30.
Subsequent events (Events subsequent to the close)
Cdiscount Alliance
In January 2014, the formalization of an Allian- ce between Almacenes Éxito S.A. and Casino Enterprise, subsidiary of the Casino Group was announced whereby Cdiscount Colombia was launched in the Colombian market.
The Brand Cdiscount is the leader in the elec- tronic commerce in France, with a volume of billing of 1.6 billions of euros (including the marketplace) in 2013, which has a successful multichannel
approach and an innovating commercial model. This alliance is formalized through a Joint Venture that will count upon a total initial investment of 10 million dollars, where Éxito will have a participation of 70% and Casino Enterprise of 30%. Since this is a transaction between related parties, it was subject to the validation of Exito’s Audit Commit- tee and of the Committee of Conflict of Interests of the Board of Directors in order to check that it will be entered into under market terms.
Acquisition of new commercial establish- ments
On February 8, 2014, by means of a communica- tion of the Financial Superintendence of Colom- bia, the home office announced the acquisition of 19 commercial establishments and the operation of another 31 establishments identified under the Superinter Brand, which are located in Valle del Cauca and the Eje Cafetero; the last two with the possibility of being acquired in 2015.