Wal-Mart Gets into Brazil’s South with a US$ 750 Million Buyout

Brazzil Magazine covers

Mike Duke, Vice- Chairman of Wal-Mart Stores announced the purchase of Sonae’s retail operations in Brazil, which include 140 hypermarkets, supermarkets and wholesale units. The total transaction was valued at 635 million euros (approximately US$ 757 million).

The Sonae retail company, formerly owned by the Portuguese group Modelo Continente, is based in Porto Alegre. It has approximately 20,000 employees and operations in the state of São Paulo and the southern states of Rio Grande do Sul, Santa Catarina and Paraná.

"This acquisition reinforces our commitment to Brazil," said Duke. "We are looking forward to the opportunity to offer customers in a new region the low prices, wide assortment of merchandise and outstanding customer service that we have become known for providing in other parts of the country."

The purchase was announced in São Paulo by Craig Herkert, President and Chief Executive Officer for Wal-Mart in the Americas, and Vicente Trius, president of Wal-Mart Brazil.

Herkert noted that Wal-Mart has significantly strengthened its position in Latin America with the Sonae purchase and the acquisition in September of a one-third interest in Central American Retail Holding Co. (CARHCO), that region’s largest retailer.

Trius said the Sonae acquisition would improve Wal-Mart’s position as a national retailer in Brazil. He said that with the acquisition, Wal-Mart Brazil will operate 295 units in 17 of Brazil’s 26 states.

Wal-Mart Brazil recently opened its first Supercenter in the federal district of Brasí­lia, the nation’s capital. In 2004, Wal-Mart acquired the 118-store Bompreço chain in northeastern Brazil from Dutch retailer Ahold.

Trius said the acquisition represents a growth opportunity for both associates and suppliers.

"We expect to learn a lot from Sonae that will help us improve further our business in Brazil," said Trius. "We are looking forward to getting to know the habits of the local customers and to strengthen relationships with the regional suppliers. They are an important part of the company’s strategy."

Wal-Mart Stores, Inc. operates Wal-Mart Stores, Supercenters, Neighborhood Markets and SAM’S CLUB locations in the United States.

The company also operates in Argentina, Brazil, Canada, China, Costa Rica, El Salvador, Germany, Guatemala, Honduras, Japan, Mexico, Nicaragua, Puerto Rico, South Korea and the United Kingdom.

Tags:

You May Also Like

Brazzil Magazine covers

In Brazil, Diplomas Don’t Open Doors for Women

Gender equality in Brazilian science is increasing up to doctorate level but few women ...

Brazzil Magazine covers

Brazil Has Lowest Foreign Debt in 8 Years

Brazil’s foreign debt, according to the Central Bank’s calculations for May, was down US$ ...

Brazzil Magazine covers

No Good Intentions

It’s a good bet that President Fernando Henrique Cardoso will close out his second ...

Brazzil Magazine covers

Brazil Offers Appealing Loans to Build 3,000 Kms of Power Lines

The president of Brazil’s National Economic and Social Development Bank (BNDES), Guido Mantega, announced, ...

Brazzil Magazine covers

Sorry, Brazil’s Carnaval Is Not a Free for All, All Out Orgy

It’s Carnaval in Rio and I am honestly not that excited about it. I ...

Brazzil Magazine covers

New Election Law in Brazil Bans T-Shirts Giveaway and Use of Celebrities

The Brazilian Senate made further changes Wednesday, April 19, in Brazil’s electoral legislation. However, ...