Walmart Brazil control sold to private equity investor
A controlling 80 per cent stake in Walmart Brazil has been sold to private equity company Advent International.
US-headquartered Walmart will retain a 20 per cent cornerstone stake in the business, with the deal to be closed later this year after regulatory clearance.
Selling the majority stake in Walmart Brazil will generate a non-cash loss in the vicinity of US$4.5 billion in the second quarter, due mostly to cumulative foreign exchange losses.
Analysts say the deal – which follows the sell-down of a majority stake in UK grocer Asda, will free Walmart to focus on its recently acquired Flipkart business in India.
“Walmart’s announcement… is a continuation of its long-standing strategy of redeploying assets, both financial and personnel, to concepts and places that have more long-term potential, and as such, is a credit positive for the company,” said Moody’s lead retail analyst Charlie O’Shea.