ZAANDAM, Netherlands -- Ahold here said last week it has become a joint owner of two major supermarket chains in South America, with combined sales of $2.5 billion U.S.
Ahold, with more than 3,000 stores worldwide, had sales of $26 billion in 1997. Last week's agreement marks the company's second investment in South America, following its acquisition in late 1996 of a 50% ownership in Bompreco, a $2 billion chain based in Recife, Brazil.
Ahold's partner in its latest joint venture in South America is Velox Retail Holdings, Buenos Aires, the largest shareholder in both Disco and Santa Isabel. Velox said it is contributing its 50.4% interest in Disco and its 37% interest in Santa Isabel to the joint venture. Ahold said it has paid Velox $368 million for its 50% stake in the joint-venture company, which will be called Disco-Ahold International Holdings. The companies said in a joint statement the aim of the partnership is to accelerate the growth of both chains.
Fritz Ahlqvist, a member of Ahold's corporate executive board and vice chairman of Disco-Ahold, said the new partnership "is fully in line with Ahold's corporate goal to become a leading global supermarket company with operations in Europe, the United States, Asia and South America."
He said last week's deal with Velox "broadens the platform to share our international experience in this part of the world, [where] our aim is to grow our presence in the major markets of South America together with well-established local partners."
Juan Peirano, chairman and chief executive officer of Velox and chairman of the newly formed supervisory board of Disco-Ahold, said,
"This partnership will clearly reinforce our growth strategy for Disco and Santa Isabel, providing additional financial strength combined with international know-how covering all aspects of the food retail business.
"The partnership will strengthen Disco's and Santa Isabel's competitiveness and provide us with the means to meet the needs of our current and new customers in the best possible way."
Ahold said it will initially finance its investment in the joint venture through a short-term loan, followed by a refinancing through an equity issue.
The companies said they also plan to commence a tender offer for a portion of the remaining shares of Santa Isabel that would increase the joint-venture's stake in the chain to 65%.
Disco, founded in 1961, recently acquired Su Supermercado and Vea Supermarket in Brazil. Of its 109 stores, 58 are in the greater Buenos Aires area.
Santa Isabel operates 68 of its 89 stores in nine of Chile's 13 regions, plus 15 units in Peru, five in Paraguay and one in Ecuador.