Walmart's Entry Leads To Rapid Consolidation In Chilean Retail

Chile's third largest supermarket operator Grupo SMU has announced it is to acquire smaller rival Supermercados del Sur. Full terms of the deal have not been disclosed, although SMU did reveal it included a capital injection of US$215mn. The move comes three years after Walmart entered the market and can be seen as a sign of the competitive pressure that the firm, with its low-priced business model, has brought to bear on the market. We expect further consolidation within the sector as local operators look to build the economies of scale needed to compete with the world's largest

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