Chile's Cencosud to buy Carrefour's Colombia assets for $2.6 billion
SANTIAGO (Reuters) - Chilean retail giant Cencosud said on Thursday it agreed to buy French retailer Carrefour's Colombian assets for 2.0 billion euros, or about $2.6 billion, as Latin American firms flex their muscles while their European counterparts struggle.
Cencosud CEN.SN said it expected to close the deal with Carrefour (CARR.PA), Europe's biggest retailer, by the end of the year. The Chilean retailer already has operations in Argentina, Brazil, Chile, Colombia and Peru.
To finance its purchase, Cencosud said it had signed a $2.5 billion loan agreement with JP Morgan Chase Bank.
Latin American retailers are riding a boom, bolstered by the increasingly easy access to credit by a growing middle class. France's Carrefour, on the other hand, is in the midst of a massive restructuring process and is seen exiting markets where its performance has lagged.
Successful Chilean firms, including miners and banks, are increasingly seduced by Colombia, which boasts a low inflation rate, natural resources and buoyant domestic demand.
Chile's CorpGroup earlier this month said it intends to buy up to 100 percent of the shares of Colombia's Helm Bank for around $1.3 billion in what would be a Chilean financial firm's biggest purchase abroad and create Colombia's fifth-largest bank.
Many retailers across Europe are struggling as consumers' disposable incomes have been squeezed by rising prices, muted wage growth and government austerity measures, as well as changing consumer habits.
(Reporting by Santiago newsroom; Writing by Alexandra Ulmer and Anthony Esposito; Editing by Leslie Adler and Phil Berlowitz)
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