January 18, 2005

WM Goes After Another Japanese Retailer, Daiei Inc.

Already taking stronger control over Seiyu, WM is poised to take Daiei out of the hands of the Japanese government:

The winning bidder for the government- led rescue of Daiei Inc., Japan's third-largest retailer, may be the group that can invest most, analysts say....

Under the plan the IRCJ announced Dec. 28, the sponsors must be prepared to invest at least $588 million in Daiei....

Wal-Mart, the world's biggest retailer, has been trying to expand in Japan since it entered country in 2002 with a 6 percent stake in Seiyu Ltd., Japan's fourth-largest merchant.

Aeon and Ito-Yokado, Japan's No. 1 and No. 2 retailers, may not have Wal-Mart's financial stability to back Daiei as they struggle to bolster earnings amid nine straight months of falling retail sales...

Daiei, which runs 63 supermarkets and 182 general merchandise stores, said last month it will close 53 unprofitable outlets.

Daiei aims to cut its debt to $3.8 billion by February 2010, targeting $426 million operating profit -- sales minus the cost of goods sold -- in that year...

An optomistic forecast...

Posted by Kevin on January, 18 2005 at 10:52 AM | TrackBack

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