Merger to expand SM Retail portfolio

The Philippines’ largest publicly listed holding company, SM Investments, has approved the merger of its retail arm, SM Retail, with several related companies.

With 1374 outlets that earned PHP53 billion (US$1.1191 billion) last year, the related companies include Ace Hardware, Baby Company, Homeworld, Kultura, Our Home, SM Appliance Center, Sports Station, Toy Kingdom, Watsons and several other specialty store brands.

The merger will complement SM Retail’s portfolio which includes 53 SM department stores, 44 hypermarkets and 213 supermarkets, as well as majority stakes in the Philippine stores of Alfamart, Crate & Barrel, Forever21 and other specialty and apparel retailers, in addition to a minority stake in Uniqlo.

Across a portfolio of apparel, food, DIY, furniture, footwear, household appliances, pharmaceuticals/cosmetics and specialty retailing stores, the combined entity will have 1927 outlets and 2.4 million sqm of gross floor area. It will serve a wide range of Filipino consumer needs in both staple and discretionary goods categories.

Post-merger, SM will own 77.3 per cent of the enlarged SM Retail.
SM president Harley Sy says the merger is consistent with the group’s goal of simplifying its corporate structure.

Meanwhile, SM’s net income increased 13 per cent last year, while consolidated net income stood at P28.4 billion, its annual report shows. Consolidated revenues grew 7 per cent to P295.9 billion.


With favourable market conditions and improved efficiencies, its retail income grew 15 per cent. Retail accounted for 22 per cent of SM’s consolidated earning.

SM’s retail arm has a strong brand franchise comprising The SM Store, and for food, SM Markets (SM Supermarket, SM Hypermarket and Savemore as well as Alfamart and Waltermart). SM’s property arm has interests in malls, residences, offices, hotels and convention centres as well as tourism-related property development. It also has banking interests.

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