* Antitrust agency approves huge merger of appliance chains * Retailer to sell 74 stores under regulatory accord * Pão de Açúcar announces $1 bln investments in 2013 By Leonardo Goy and Brad Haynes BRASILIA/SAO PAULO April 17 (Reuters) - Grupo Pão de Açúcar SA, Brazil's biggest retailer, won regulatory approval on Wednesday for its 2009 purchase of the Casas Bahia and Ponto Frio appliance chains in exchange for selling less than 8 percent of their store fronts. The retailer said in a securities filing that it will sell 74 stores generating about 3 percent of gross revenue for its Viavarejo home appliance unit, formed by the acquisitions. But it said it still expects to "capture all the cost savings of the merger." Brazilian antitrust watchdog Cade approved the deal "with restrictions" earlier on Wednesday, requiring Pão de Açúcar to sell assets in 54 cities generating annual revenue of 900 million reais ($450 million). The retail group's net sales revenue was 51 billion reais last year. The Cade approval will allow Pão de Açúcar to continue with the final consolidation of the deal, but highlights regulators' desire to show their teeth in defense of Brazil's growing consumer class. Shares of Pão de Açúcar fell 1.8 percent to 103.80 reais in afternoon Sao Paulo trading and are down 2.2 percent this week, on track for their biggest weekly loss in three months. Pão de Açúcar also announced on Wednesday that shareholders had approved plans to increase investments to 2.02 billion reais in 2013. The retailer invested 1.58 billion reais last year, in line with 2011 but below the 1.8 billion reais target it had set for 2012. The company aims to boost investments by 80 percent over the next three years, according to local media reports. The focus of capital spending this year will be 100 new Minimercado Extra supermarkets, executives have said, as it targets smaller cities with less direct competition. Convinced they can outperform in a cooling market, Brazil's biggest retailers are stepping up investments in new stores this year and could expand their floor space more than their sales, according to industry estimates. Pão de Açúcar agreed to buy Ponto Frio in June 2009 and Casas Bahia in December 2009, forming a retail giant via a complex asset swap valued at about 4 billion reais. The resulting Viavarejo numbers about 1,000 of Grupo Pão de Açúcar's more than 1,600 stores. Cade ruled in 2010 that Pão de Açúcar would have to keep the brands, stores and management of the Casas Bahia and Ponto Frio chains separate until the agency's final ruling. French group Casino took control of Pão de Açúcar from its founding family in June 2012.