Moscow, April 17 - French retailer Carrefour has provisionally valued Russian takeover target Seventh Continent at $1.25 billion, including its real estate holdings, two banking sources close to talks said on Friday.
Carrefour made the Russian retailer a non-binding offer in late February, the banking sources told Reuters.
The valuation includes 100 percent of Seventh Continent, 100 percent of the affiliated MCapital, which controls most of the company's real estate assets, and $450 million of debt, the sources said.
The audit will continue for another 2-3 weeks, they said.
Carrefour was not immediately available for comment.
If the deal goes ahead, Carrefour would become the first foreign company to enter the Russian retail market since the credit crunch hit local firms.
Russian retailers face a difficult year as the country battles against recession while rising unemployment and slower income growth hit consumers.
But the downturn may also offer global majors an easier entry into a sector which has more potential than many mature markets and where distressed assets prices are set to plunge.
Seventh Continent, which has 140 stores, saw its sales rise 23 percent to $1.4 billion last year.
Deutsche Bank currently holds a controlling stake of 74.81 percent in Seventh Continent as collateral on a $560 million loan to majority owner Alexander Zanadvorov.
Zanadvorov has been trying to refinance the credit or attract an investor since a margin call on the loan late last year, the sources said.