Royal Ahold, the giant Dutch retailing group, has taken 100 per cent control of Disco Ahold International Holdings (DAIH), the joint venture which it operated in Latin America with the Velox Retail Holdings group.
The venture was dissolved in July after VRH defaulted on loan payments it owed to a number of creditor banks, forcing the Dutch group to assume the debts and effectively take over all VRH's shares in the joint venture.
The cost of dissolving the joint venture was around $490 million (€501m), Ahold said. The Dutch group now controls 100 per cent of DAIH, compared to the 66 per cent stake it held before.
While the takeover of DAIH, which operates more than 350 supermarkets in Argentina, Chile, Peru and Paraguay, will help Ahold further pursue its international development, the expansion has come at a price.
Ahold said that it would take a charge of around €350 million in the second quarter of 2002 as a result of the purchase of the shares at considerably more than their fair value.
As a result of the deal, Ahold now wholly owns 236 Disco supermarkets in Argentina with 2001 sales of €2.1 billion. In addition, Ahold has a 70 per cent stake in 76 Santa Isabel supermarkets in Chile, 30 in Peru and 11 in Paraguay with 2001 sales of €771 million.