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Wal-Mart weighs bid for HK retailer

Wednesday, August 07, 2013 - 01:32

Aug 7 - Wal-Mart is considering a purchase of Hong Kong's second largest supermarket chain, ParknShop, from Asia's richest man, sources tell Reuters. Fred Katayama reports.

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TV AND WEB RESTRICTIONS~****~ Wal-Mart has been struggling in China, but that's not stopping it from considering bidding for Hong Kong's second largest supermarket chain. Sources told Reuters the world's largest retailer is looking at ParknShop, the retailer controlled by Asia's richest man Li Ka-shing, who values it at up to $4 billion. Wal-Mart would not comment. With 345 stores in Hong Kong, the mainland and Macau, ParknShop would give Wal-Mart a platform to expand in a country where managing growth has been a challenge for foreign retailers amid the slowdown. In spring, local reports said Wal-Mart was closing stores that were hit with higher costs for rent and labor. Two years ago, the head of its China operations quit amid a scandal involving mislabeled pork products. And after finding that its do-it-yourself culture would not take root there, Home Depot took it upon itself to close all of its stores. But Wal-Mart, a 17-year veteran in China, insists it's on track with plans to open 100 new stores there over the next three years and hire 18,000 workers. It ranks second in share for hypermarkets behind Sun Art Retail, a Taiwanese-French joint venture. Wal-Mart's shares edged slightly lower on the news. It's up 14 percent this year, underperforming rivals such as Target and Costco and the broader market. Wal-Mart will face strong competition. Among the eight invited to bid: its archrival, Sun Art, Japan's Aeon, and Australia's Westfarmers and Woolworths. It has until August 16 to make an offer.

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Wal-Mart weighs bid for HK retailer

Wednesday, August 07, 2013 - 01:32