Wal-Mart purchases interest in Central America's largest retailer

John Menzer,president and CEO of Wal-Mart International announced today the purchase of a 33-1/3 percent interest in Central American Retail Holding Company (CARHCO), Central America's largest retailer. The retailer has 363 supermarkets and other stores in Guatemala (120), El Salvador (57), Honduras (32), Nicaragua (30) and Costa Rica (124), and its sales during 2004 were about $2 billion. Wal-Mart acquired its interest in CARHCO from the Dutch retailer Royal Ahold NV. The purchase price was not disclosed. CARHCO was formed as a joint venture in 2001 with three equal partners: Ahold and two Central American groups, the Paiz family, the major shareholders of La Fragua, with headquarters in Guatemala, and Corporacion de Supermercados Unidos, with headquarters in Costa Rica. As part of the agreement, Wal-Mart will acquire additional interests over time in CARHCO, including interests toward achieving majority ownership in the company. The new partnership demonstrates confidence in the region's economic potential, Menzer said, adding that significant investments are planned in the years ahead to open new stores. The investment in CARHCO is Wal-Mart's first in Central America, although the region is a major source of apparel for the company.