Wal-Mart's Solorzano leaves Latam CEO post

Fri Jan 11, 2013 5:28pm EST

1 of 3. A clown sits inside a bus seen in front of a Wal-Mart store in Mexico City January 11, 2013.

Credit: Reuters/Edgard Garrido

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(Reuters) - Wal-Mart Stores Inc (WMT.N) is replacing the chief of its Latin American unit, who had run the retailer's business in Mexico when the company reportedly began a probe into bribery allegations in the country.

Eduardo Solorzano will step down as president and chief executive of the unit, and will be succeeded by Enrique Ostale. Solorzano will remain as chairman of the board of directors at Wal-Mart de Mexico (WALMEXV.MX), the Mexican unit of the world's largest retailer, Wal-Mart said on Friday.

The move comes as the world's largest retailer remains under fire following a New York Times report in April 2012 that said Wal-Mart had intentionally stifled an internal probe in 2005 into allegations that Walmex officials had paid bribes to help build stores in Mexico.

Solorzano, 55, became the CEO of Walmex in early 2005 and held that role until early 2010, when he became president and CEO of Walmart Latin America.

Solorzano's career at Walmex began in 1985. According to the Times and emails released by U.S. lawmakers on Thursday, Wal-Mart executives were made aware of alleged bribery in the fall of 2005.

Wal-Mart has said it is cooperating with the U.S. Justice Department, the U.S. Securities and Exchange Commission and Mexican authorities in their investigations of the bribery allegations.

The timing of Solorzano leaving the Latin America job had nothing to do with the investigation, the company said.

"He will remain as chairman of the Walmart de Mexico Board of Directors. The changes we're announcing today are just part of our normal process as we work to develop global talent," Wal-Mart said in a statement.

Wal-Mart shares edged up 27 cents to $68.63 on Thursday.

Ostale, 52, had been president and CEO of Walmart Chile, formerly known as D&S, and will take on his new role in Mexico City on March 1, Wal-Mart said. He will be responsible for operations in Argentina, Brazil, Chile, Costa Rica, El Salvador, Guatemala, Honduras, Mexico and Nicaragua, which include 3,832 retail units and 373,000 employees.

Walmex's chief operating officer, Gian Carlo Nucci, will replace Ostale as president and CEO of Walmart Chile. Nucci, 43, joined Walmex in 1993.

Ostale joined D&S in 1989, left in 2000 and returned in 2006. Wal-Mart bought D&S in 2009. Wal-Mart said Ostale was key in leading the transformation of D&S to Walmart Chile.

Ostale is set to become the fourth CEO of Walmart Latin America since that position was created in 2004.

Separately, Danish pension fund PFA Pension said it would no longer invest in Wal-Mart, saying the retailer does not meet its standards for workers' rights, citing recent events such as a protest by U.S. workers the day after Thanksgiving, the busy shopping day known as Black Friday.

PFA Pension said it would withdraw an investment of 50 million Danish kroner ($8.79 million). The fund said it had pulled out of its Wal-Mart investment in the past, but then bought back in as it started to see improvements.

(The story is refiled as Wal-Mart corrects Solorzano's age)

(Reporting by Jessica Wohl in Chicago, additional reporting by Cyntia Barrera Diaz in Mexico City; editing by John Wallace, Nick Zieminski and Richard Chang)

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Comments (1)
MikeBarnett wrote:
These moves simply increase doubts about the integrity of US companies because they don’t address and explain issues while revealing a time frame that offers some proofs that the criminal allegations are true. They appear to be playing for time and hoping that everyone will forget.

My partners and I moved our investments from the US to Asia in 1999, and the crises caused by US criminals and abetted by the Bush and Obama regimes have proved that we made the “right” decisions in terms of wisdom and morality. We have become more productive as we no longer care if someone uses our knowledge for profits because we will make more wealth for everyone in the long run if we help create more new customers. “From each according to his abilities; to each according to his needs” is a sensible business plan at higher levels of economic development because it keeps more wealth flowing to more people who become customers and tax payers, so all sectors gain.

Jan 12, 2013 5:55pm EST  --  Report as abuse
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