Wal-Mart allegedly made an offer for BJs Wholesale Club

Wal-Mart allegedly made an offer for BJ's Wholesale Club

Wal-Mart Stores made a bid for US wholesaler BJ's Wholesale Club in the spring for more than US$3bn, according to reports.

BJ's Wholesale Club rejected an offer of more than $55 per share in mid-April, the New York Post reported yesterday (8 August), citing anonymous sources.

According to one source, the bid "seemed like a serious offer, like they weren't just kicking the tyres".

Wal-Mart declined to comment on the reports, while BJ's Wholesale Club had not responded to requests for comment as this article went to press.

In June, private-equity firms Leonard Green & Partners and CVC Capital Partners struck a deal to buy BJ's Wholesale Club for around US$2.8bn.

According to proxy statements relating to BJ's Wholesale Club, the retailer had entered into talks with an unnamed company called "Party A".

The statements say that advisers presented their views of the anti-trust issues that would be likely to come into play should that acquisition have taken place. BJ's Wholesale Club also outlined the "potential adverse effects" on its business if particularly sensitive information were shared or "if an acquisition by Party A were to be announced but not closed".

BJ's Wholesale Club representatives met with the president of "Party A" on 18 April, where they said that Party A was "not prepared to agree to significant divestitures if necessary to achieve anti-trust clearance".

Following the meeting, BJ's Wholesale Club and its independent advisers decided that they "did not believe that pursuing a possible transaction with Party A was in the best interests of the company and its stockholders in view of the significant antitrust and business risks".

Wal-Mart's performance in the US has lagged in recent years, with the company's most recent results seeing sales in the US rise by 0.6% to US$62.7bn, despite comparable store sales in the US falling 1.1% over the quarter.