March 27, 2013

Retailer Aeon to increase stake in Daiei

Japan-based retailer Aeon is set to increase its stake in retail chain Daiei from 19.9% to 44.2% by making an investment of JPY40.3bn ($426m).

By admin-demo

Japan-based retailer Aeon is set to increase its stake in retail chain Daiei from 19.9% to 44.2% by making an investment of JPY40.3bn ($426m).

The retailer intends to buy a further 24.3% stake from trading house Marubeni, which owns 29.3%.

In a statement released by the company, Aeon stated that it would acquire 48.4 million shares from Daiei’s major stakeholder energy firm Marubeni, reported Bloomberg.

The take over bid is expected to commence in April 2013.

Through this deal, the retailer will own controlling rights of Daiei, besides emerging as a dominant player in country’s supermarket business.

Aeon’s investment comes on the back of company’s plan to expand the retail network in the urban locations in the country.

During a press conference in Tokyo, Aeon president Motoya Okada stated that the company is seeking retail portfolio growth with the launch of additional stores to its starting 2014.

"Aeon would like to develop its supermarket business in urban areas.

"We face severe business circumstances and fierce competition, (and) there are a lot of things we can do," elaborated Okada.

Following the transaction, Aeon plans to ravamo loss-making Daiei stores, besides expanding the supply of its private-brand products.

Earlier in March 2013, Aeon announced that it is keen on acquiring supermarket chain Peacock Stores from J Front Retailing for JPY30bn ($317.3m).