Wal-Mart linked to Carrefour takeover
Markets buzz with mega-merger talk
February 18 2004
Rumours that Wal-Mart is planning a bid for French rival Carrefour have swept the global markets.
The prospect of a mega-merger between the world’s two biggest retailers have pushed the price of shares in Carrefour up sharply, despite scepticism once traders stop to reflect on the regulatory obstacles such a merger could raise in territories such as South America and Asia, where both retail giants have been expanding.
[img r]walmartcopy.jpg[/img]Wal-Mart has about 3,500 stores worldwide compared to Carrefour’s 10,000-plus, although Wal-Mart’s typically larger units generated sales of around $250bn last year compared to around $100bn for Carrefour.
Carrefour has a strong presence in Europe, not simply in its home territory of France but also in countries such as Belgium and Spain.
[img l]asdasutton1.jpg[/img]Wal-Mart’s European presence currently consists of the successful Asda chain in the UK, and an underperforming German operation.
This week saw Carrefour resume its expansion in China, opening its first hypermarket in the northwestern region of Xinjiang, on the centuries-old Silk Road trading route.
Carrefour’s opening programme has been on hold as it worked to overcome official Chinese concerns that it had bypassed regulations relating to foreign investment. Carrefour now has 42 stores in China and plans to expand at the rate of one a month. Wal-Mart currently has 34 stores in China.
