The French government shot down an offer from Canada’s Alimentation Couche-Tard Inc. to acquire hypermarket chain Carrefour SA, according to people familiar with the matter, saying the move threatened jobs and France’s food security amid the Covid-19 pandemic.

Couche-Tard’s offer to buy Carrefour for 16.1 billion euros, equivalent to $19.66 billion, would have created the world’s third-largest grocery retailer, behind Walmart Inc. and Lidl owner Schwarz Group. But French Finance Minister Bruno Le Maire told Couche-Tard Chairman Alain Bouchard in a closed-door meeting in Paris on Friday that he was opposed to the takeover, according to people familiar with the matter.

Mr. Le Maire told the executive the sale would put France’s food security and tens of thousands of jobs at risk, the people said. Carrefour is one of the country’s largest employers with 105,000 staff.

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