China’s largest supermarket operator Lianhua, is reportedly interested in the acquisition of Trust-Mart, which is expected to fetch in excess of US$1bn, joining Carrefour and Wal-Mart in attempting to acquire the Chinese retail chain.
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According to a report in the Financial Times, Lianhua is likely to submit a preliminary offer for Trust-Mart before the deadline for bids ends next week.
Trust-Mart has 100 stores in 20 cities across China. The sale represents a rare opportunity to acquire a national chain in China, rousing the interest of the French and US retail giants. However, the newspaper reported, Lianhua’s interest demonstrates the challenge posed to foreign buyers by domestic firms in China’s mergers and acquisitions market.
Analysts have observed that Wal-Mart and Carrefour pack more financial clout than Lianhua. But any bid from the Chinese retail chain would be funded through equity issuance or help from its parent company, the Bailian Group, which is controlled by the Shanghai Government, the paper said.
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By GlobalData
