TOKYO (Reuters) – Walmart Inc WMT.N is selling a majority stake in Japanese supermarket chain Seiyu to investment firm KKR KKR.N and e-commerce company Rakuten 4755.T for over $1 billion, after years of struggling to make money amid stiff competition.
The deal, which values Seiyu at 172.5 billion yen ($1.65 billion), comes after on-off speculation about the U.S. retail giant looking to exit Japan. It is well below the 300-500 billion yen it reportedly sought a few years ago.
KKR will buy 65% of Seiyu while Rakuten, which already has an online venture with the chain, will acquire a 20% stake. Walmart will retain 15%, the companies said in a joint statement on Monday.
The world’s biggest retailer first entered the Japanese market in 2002 by buying a 6% stake in Seiyu, and gradually built up its stake before a full takeover in 2008.
But it has struggled in Japan, like other foreign entrants such as Tesco PLC TSCO.L and Carrefour SA CARR.PA who were lured by the high spending power of Japanese consumers but were frustrated by tough competition. Reuters News