|Brazil Retailer Magazine Luiza To Buy Lojas Maia|
|Friday, 06 August 2010 10:13|
Brazilian retailer Magazine Luiza on Monday announced the purchase of rival Lojas Maia, for an undisclosed amount, as part of a strategy of geographic expansion. Magazine Luiza is strong in Brazil's southeast and south with 456 stores, while Lojas Maia is strong in the Brazilian northeast with 141 stores, said Luiza Trajano, president of Magazine Luiza.
Magazine Luiza reported 2009 gross revenue of 3.8 billion Brazilian reals ($2.13 billion), while Lojas Maia had revenue of about BRL1 billion.
Trajano said Brazilian retail sales will likely soar in 2010 as the nation's economy rebounds from a recession. Sales of the combined company to be forged from Magazine Luiza and Lojas Maia in 2010 will reach BRL6 billion, she said.
Press reports earlier Monday indicated Magazine Luiza was in talks to buy Lojas Maia for approximately BRL300 million, but executives for the two companies declined to comment on the purchase price.
Trajano, however, said Magazine Luiza was paying 40% in cash and 60% in the form of assumption of Lojas Maia debt.
"No bank loans are involved at all," she added.
Trajano said her company isn't currently eyeing any additional acquisitions.
Marcelo Silva, superintendent of Magazine Luiza, said the company was studying a possible share offer, but he said no timetable has been set for such an offer.