Wal-Mart in share-purchase deal with China Resources SZITIC Investment

A woman examines goods on sale at an outlet of Wal-Mart Inc in Yichang, Hubei province. [Photo/China Daily]

Wal-Mart Stores Inc on Wednesday signed an agreement with China Resources SZITIC Investment Co Ltd for the purchase of minority interests in 21 joint ventures. The deal is valued at 3.3 billion yuan ($520 million).

This agreement is, however, subject to approval from the relevant government authorities.

"Wal-Mart is confident in the Chinese market. We are increasing our investments in China in both Wal-Mart and Sam's Clubs to better serve our customers and members and to become the most trusted retailer in China," said Sean Clarke, president and CEO of Wal-Mart China.

"The investment closely follows the decision to acquire 100 percent of Yihaodian, reflecting our belief that Chinese customers want a seamless online and offline shopping experience," said Clarke.

At the completion of the proposed share purchase, China Resources SZITIC Investment Co Ltd will no longer be a shareholder of the joint ventures with Wal-Mart.

New store openings in China have driven up third-quarter sales growth by 2.9 percent for Wal-Mart Stores Inc, the world's largest retailer by revenue. In the country's hypermarket sector, the retail giant claimed it gained market share for the 11th quarter running.

Officials said China remains a key growth market and that it will continue to invest in its physical and digital operations, to deliver what it called a seamless shopping experience in the country.

Wal-Mart Asia CEO Scott Price said the company continues to drive efficiency in its China stores and across its country operations, and that operating income grew faster than net sales.

Its "operate for less" productivity initiative remains a focus, allowing it to invest in more staff and its customer experience, particularly when it comes to fresh produce.

He said online-to-offline－where shoppers order online and collect instore－is critical to the business, as customers increasingly look for convenience.

During the quarter, he revealed Wal-Mart opened five new stores in Guangdong province's Heyuan and Dongguan, in Zhejiang province's Huzhou and in Guizhou's Bijie.

It plans to open more hypermarkets in the Inner Mongolia autonomous region, Yunnan, Shandong, Fujian, Hubei and Guangdong provinces, it said.

Yihaodian, the retailer's e-commerce business in China, remains focused on further leveraging the company's global and local assets, Price said.

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