MEXICO CITY, MX – Mexican retailer Soriana has confirmed its agreement to buy 160 stores from Controladora Comercial Mexicana (CCM) for $2.6 billion.

This acquistion positions Soriana as the country’s second-largest retail chain, behind only Wal-Mart de Mexico. 

“Our main [chain] competitor remains much bigger than us. That’s one reason for the acquisition, to get closer to them,” Soriana Chief Executive Ricardo Martín Bringas told the Wall Street Journal on a conference call. “Better and more balanced competition will benefit all Mexicans.”

This agreement with CCM includes the acquisition of 118 fully owned stores and the lease for 42 others from a third party. This would boost Soriana’s store count to 834. Soriana is planning to initially finance the purchase through debt, and aims to pay it off within four years.

The Wall Street Journal reports that the retailer is also considering an equity sale to raise between $500 million and $600 million in capital to help pay down the acquisition and expects to sell more than $100 million in nonstrategic assets.

This acquisition will leave CCM with just 40 high-end stores along with other assets that the retailer plans to spin off to create a new company less than a quarter of its original size, according to Reuters.

For now, Soriana will be sitting comfortably as Mexico’s second-largest retail chain with about 22% market share.

Stay tuned to AndNowUKnow for the latest on this acquisition and other significant retail news.

Soriana