UPDATE 1-Carrefour Brasil plans to expand; considers purchases and partnerships

By Gram Slattery and Gabriela Mello

SAO PAULO, March 12 (Reuters) - Carrefour Brasil,one of Brazil's largest retailers, plans to aggressively expandits store network, and will consider acquisitions andpartnerships as part of that drive, executives said on Monday.

Overall, the company plans to open 20 wholesale stores in2018, 10 traditional hypermarkets and 20 Carrefour Expressconvenience stores. It also plans to convert five to sevenhypermarkets into wholesale stores this year and has thepotential for a total of 120 to 140 new stores by 2022, theexecutives said.

"We have the potential to do our work in 80 to 85 cities,"Roberto Mussnich, head of Carrefour Brasil's wholesale division,told investors and analysts at the company's annual investors'day in Sao Paulo.

The expansion plans, particularly in the wholesale Atacadaoformat, reflects the company's ambitions to gain and consolidatemarket share as Brazil's food retail market turns a corner onthe backside of a years-long recession in Latin America'slargest economy.

The company, the Brazilian unit of France's Carrefour SA, is seen as fighting head-to-head with Brazil's GPA, a unit of France's Casino Guichard Perrachon SA, which is also expanding aggressively.

Speaking to journalists, Carrefour executives said they wereopen to non-organic expansion options, such as entering intofranchising agreements or acquiring high-quality regionalplayers.

"We don't have any barriers set up. ... A franchising modelin supermarkets is possible. We're open to everything," ChiefExecutive Officer Noel Prioux said, adding that the company has"identified potential partnerships."

Regarding WalMart Inc's Brazil operations, which arecurrently on the block, Prioux said there needed to be moreclarity about the structure of the sale process before CarrefourBrasil could say if it was interested in any part of theretailer.

At the investors' day, executives also emphasized BrasilCarrefour's focus on expanding its e-commerce and digitalfootprint in the coming years.

The retailer plans to offer at all its locations in Brasilthe option to purchase items online and pick them up in personat a Carrefour store by the end of 2018, said Paula Cardoso,head of Carrefour Brasil's financial division.

She said the retailer is negotiating with 95 vendors to sellon the company's online "marketplace," which will offercustomers more than 120 product categories.(Reporting by Gabriella Mello; Writing by Gram SlatteryEditing by Leslie Adler)