Comerci, Chedraui Said Near $4 Billion Mexico Supermarket Deal

By Ben Bain and Jonathan Levin 

 

Photographer: Gustavo Graf/Bloomberg

Chedraui is Mexico’s fourth-largest supermarket operator by market capitalization,... Read More

Controladora Comercial Mexicana SAB (COMERUBC) is close to an agreement to sell the bulk of its 200 retail stores to Grupo Comercial Chedraui SAB (CHDRAUIB), according to a person with knowledge of the deal.
Comerci, as the Mexico City-based seller is known, would keep the real estate and lease it to Chedraui, which would use its own brand for the stores it purchases, the person said, asking not to be identified because the negotiations are
still private. The transaction value is likely to amount to more than $4 billion, according to the person. Comerci has a market value of 55.2 billion pesos ($4.09 billion).
Comerci’s decision to sell the supermarkets comes less than two months after Grupo Gigante SAB (GIGANTE*) agreed to purchase most of its Restaurantes California and Beer Factory eateries for 1.1 billion pesos ($80 million). While the final terms of the agreement for its retail stores haven’t yet been set, Comerci is pushing for Chedraui to pay cash, the person said.
Any deal would still be subject to regulatory approval, according to the person. Chedraui is Mexico’s fourth-largest supermarket operator by market capitalization, while Comerci is the third-largest. Wal-Mart de Mexico SAB and Organizacion Soriana SAB are the nation’s largest and second-largest retailers, respectively.
Comercial Mexicana, whose holdings include the upscale City Market grocery stores in the capital’s metropolitan area, hired Rothschild earlier this year to find a buyer for the entire business, people said at the time.
Comerci shares have climbed 1.9 percent in the past month, the most on Mexico’s benchmark IPC index after El Puerto de Liverpool SAB, while Chedraui’s have dropped 7 percent.
Comerci and Chedraui didn’t respond to e-mails and telephone calls seeking comment outside of normal business hours.
El Financiero reported earlier that Comerci was getting close to a deal with Chedraui.