Wal-Mart Stores Inc. is taking control of a Central American retail chain that it bought into in September as it expands in Latin America to bolster its international growth, the world's largest retailer said yesterday.
Wal-Mart said it had raised its stake in Central American Retail Holding Co., also known as CARHCO, to 51 percent from 33.3 percent. Terms of the latest deal were not disclosed.
CARHCO is Central America's leading retailer, with 375 supermarkets and other stores in Guatemala, El Salvador, Honduras, Nicaragua, and Costa Rica. It has about 23,000 employees and had 2005 sales of about $2.2 billion, Wal-Mart said. Wal-Mart had $312.4 billion in worldwide sales last year.
The company will be renamed Wal-Mart Central America. The region is a key part of Wal-Mart's international growth strategy that also includes places like China, Japan, Korea, Britain, and Germany.
A spokeswoman declined to say if Wal-Mart would further increase its stake in CARHCO.
CARHCO's remaining owners are the Paiz family, the major shareholders of La Fragua, with headquarters in Guatemala, and Corporacion de Supermercados Unidos, with headquarters in Costa Rica.
Wal-Mart's international division is growing faster than its US operations. In 2005, the international business, which operates in 15 countries, saw net sales and operating income rise 11.4 percent, compared to 9.4 percent for sales and 8.2 percent for operating income at the US division, minus Sam's Clubs.
Late last year it extended its overseas business by buying 140 Sonae stores in Brazil and increasing its stake to a majority in Japan's Seiyu Ltd., which has 405 stores. Wal-Mart already has a strong presence in Mexico.
CARHCO president Rodrigo Uribe will become chairman of Wal-Mart Central America's board of directors.
Uribe said Wal-Mart's investment ''will enable the corporation to provide a larger assortment, better service and prices to consumers in Central America."