A deal for Taiwanese supermarket chain operator PX Mart Co Ltd (全聯實業) to acquire RT-Mart International Ltd (大潤發) could pose significant challenges for Carrefour Taiwan (家樂福), as the acquisition would help PX Mart extend its reach to the hypermarket business, according to a research economist.
“The acquisition deal is expected to boost competition in Taiwan’s hypermarket sector,” Commerce Development Research Institute deputy director-general Li Shyh-jane (李世珍) said. “It is possible that Carrefour might get nervous.”
On Friday night, PX Mart surprised the local retail industry by announcing the deal, which is expected to be completed in the middle of next year.
Photo courtesy of PX Mart Co Ltd
In a statement, PX Mart said that it would acquire RT-Mart from France-based retailer Auchan Retail International SA and Taiwan-based conglomerate Ruentex Group (潤泰集團).
The deal covers buildings and land owned by RT-Mart, in addition to distribution rights and the self-developed RT-Mart brand, the statement said, adding that the deal is pending regulatory approval.
“RT-Mart is ahead of Carrefour in service technology innovations,” Li said, referring to RT-Mart’s digital payment applications, which have added to shopping convenience.
PX Mart uses its PXPay digital payment application to consolidate online and offline customer bases to record customers’ shopping habits, Li said.
“After PX Mart and RT-Mart integrate their digital resources, the combination could be extraordinary,” he added.
Li said that the deal is expected to create synergy for PX Mart.
“PX Mart and RT-Mart are complementary to each other, and each has a different customer base,” Li said. “The combination is expected to help PX Mart broaden its customer portfolio.”
However, time is needed to observe whether the integration process for the two companies can proceed smoothly, he added.
Founded in 1998, PX Mart operates the largest supermarket chain in Taiwan with 1,056 outlets nationwide, and plans to boost the number to 1,100 this year. Sales for this year are expected to total NT$150 billion (US$5.38 billion) this year, it said.
Earlier this year, PX Mart opened a 4,000 ping (13,200m2) flagship store in Taipei’s Nangang District (南港), moving it one step closer to a goal of running large stores.
RT-Mart has 22 outlets in Taiwan, making it the second-largest hypermarket chain in Taiwan after Carrefour.
After acquiring Wellcome Taiwan Co Ltd (惠康百貨), and along with it Taiwan’s Wellcome and Jasons Market Place supermarkets, Carrefour has a total of 354 outlets across the country with sales likely to reach NT$90 billion this year.
PX Mart did not provide financial details about the acquisition, but Ruentex Group subsidiaries Ruentex Development Co (潤泰新) and Ruentex Industries Ltd (潤泰全) said in a statement on Friday that they are selling their stakes in RT-Mart for NT$1.303 billion each.
The subsidiaries said that they expect to book gains of NT$1.175 billion and NT$1.151 billion respectively on the sale.
They said that RT-Mart’s book value per share is NT$25.48.
Industry sources said the consideration of the acquisition could top NT$13 billion.
In an internal letter to RT-Mart’s employees, Auchan chairman Edgard Bonte said the deal is part of his group’s global strategy, which was adjusted in March last year to dispose of its “nonstrategic” assets.
Auchan withdrew from the Chinese market in October last year.
Bonte praised PX Mart as a capable and professional retail business operator, saying he has faith that the new owner can raise RT-Mart’s competitive edge.
After the acquisition, Auchan, which currently owns a stake of about 65 percent in RT-Mart, is likely to withdraw from the Asian market, analysts said.
Semiconductor shares in China surged yesterday after Reuters reported the US had ordered chipmaking giant Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to halt shipments of advanced chips to Chinese customers, which investors believe could accelerate Beijing’s self-reliance efforts. TSMC yesterday started to suspend shipments of certain sophisticated chips to some Chinese clients after receiving a letter from the US Department of Commerce imposing export restrictions on those products, Reuters reported on Sunday, citing an unnamed source. The US imposed export restrictions on TSMC’s 7-nanometer or more advanced designs, Reuters reported. Investors figured that would encourage authorities to support China’s industry and bought shares
TECH WAR CONTINUES: The suspension of TSMC AI chips and GPUs would be a heavy blow to China’s chip designers and would affect its competitive edge Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, is reportedly to halt supply of artificial intelligence (AI) chips and graphics processing units (GPUs) made on 7-nanometer or more advanced process technologies from next week in order to comply with US Department of Commerce rules. TSMC has sent e-mails to its Chinese AI customers, informing them about the suspension starting on Monday, Chinese online news outlet Ijiwei.com (愛集微) reported yesterday. The US Department of Commerce has not formally unveiled further semiconductor measures against China yet. “TSMC does not comment on market rumors. TSMC is a law-abiding company and we are
FLEXIBLE: Taiwan can develop its own ground station equipment, and has highly competitive manufacturers and suppliers with diversified production, the MOEA said The Ministry of Economic Affairs (MOEA) yesterday disputed reports that suppliers to US-based Space Exploration Technologies Corp (SpaceX) had been asked to move production out of Taiwan. Reuters had reported on Tuesday last week that Elon Musk-owned SpaceX had asked their manufacturers to produce outside of Taiwan given geopolitical risks and that at least one Taiwanese supplier had been pushed to relocate production to Vietnam. SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year that Taiwan is an “integral part” of China, sparking sharp criticism from Taiwanese authorities. The ministry said
US President Joe Biden’s administration is racing to complete CHIPS and Science Act agreements with companies such as Intel Corp and Samsung Electronics Co, aiming to shore up one of its signature initiatives before US president-elect Donald Trump enters the White House. The US Department of Commerce has allocated more than 90 percent of the US$39 billion in grants under the act, a landmark law enacted in 2022 designed to rebuild the domestic chip industry. However, the agency has only announced one binding agreement so far. The next two months would prove critical for more than 20 companies still in the process
RSS