French retail group Auchan is to merge with Rt-Mart, the supermarket retail investment of Hong Kong-based Ruentex Group, according to reports.

It is understood the two may launch an IPO in Hong Kong in 2010, China Retail News reported yesterday (19 October).

However, it is believes the two parties are still in negotiation. If they reach an agreement, their cooperation will be limited to the Chinese mainland market and will exclude Taiwan.

Rt-Mart will reportedly maintain its expansion rate in 2009 and open 14 new stores before the end of the year.

Earlier this month Auchan took its primary steps into the Middle East with the opening of its first store in Dubai.

The operation is a joint venture with Dubai World subsidiary Nakheel and Auchan, who will operate together under the HyperCorp banner, with the aim of expanding across the Gulf.

When contacted by just-food, Auchan neither confirmed or denied the reports.