MEXICO CITY (Reuters) - Costa Rica’s competition regulator has rejected Wal Mart de Mexico’s bid to buy a local supermarket chain, the agency’s president said on Wednesday.
The retailer’s plan to buy 52 markets would have increased its store tally in the Central American nation to more than 300.
The company known as Walmex, a unit of U.S.-based Walmart Inc , already has 252 stores in Costa Rica, which is one of its worst-performing Central American markets.
The company said in July it had agreed to buy Grupo Empresarial de Supermercados’ stores in Costa Rica as part of a growth plan for the region. It did not disclose the price.
Costa Rica’s Commission for the Promotion of Competition (COPROCOM) notified Walmex in December that it opposed the deal, saying the acquisition could give the retailer enough market power to alter prices, exclude competitors or affect suppliers.
The commission gave Walmex, which said the acquisition would be positive for consumers, the opportunity to appeal the decision.
Rodolfo Chevez, COPROCOM’s president, told Reuters in a phone interview that the company’s arguments, when put to a “technical study,” did not ultimately alter the commission’s decision from December, which is now final.
Walmex was not immediately available to comment
The company also operates in Guatemala, El Salvador, Honduras, Nicaragua and Mexico, its largest market by far with 2,400 stores. Costa Rica was the second-worst performer in the third quarter this year by same-store sales. The weakest market was Nicaragua, where political turmoil caused sales to drop.
Reporting by Daina Beth Solomon; Editing by Dave Graham and Peter Cooney