Monday, June 26, 2000
Royal Ahold, the food provider today announced it has completed the transaction to purchase the remaining 50% of the voting shares of Brazilian food retailer, Bompreço. For the 50% held by Mr. João Carlos Paes Mendonça and his family, Ahold has paid in real estate, cash and Ahold common shares.
Ahold initially established a 50/50 partnership with Bompreço in December 1996. In 1999, Bompreço generated sales of BRL 2.7 billion (Euro 1.3 billion) through 61 supermarkets, 19 hypermarkets and 22 other food retail stores which employ 21,500 associates. Mr. Paes Mendonça, who has served the company as Chairman, President & CEO for 52 years, has agreed to continue as an advisor to the Bompreço Board of Directors.
Ahold President & CEO, Cees van der Hoeven said: 'Jointly with the Paes Mendonça family and the excellent local management team, we have developed Bompreço into Northeastern Brazil's leading food retailer. The company is profitable and has considerable opportunities to grow further. Though we regret the departure of João Carlos Paes Mendonça from Bompreço's day-to-day operations, we are proud he has decided to sell the family stake to Ahold.'
Allan Noddle, Royal Ahold's Executive Vice President, responsible for Latin American operations said: 'We are determined to continue the success of Bompreço and its excellent customer relations. We are very confident the Brazilian management team and all Bompreço's associates will continue to perform in the utmost professional manner. We thank João Carlos for his outstanding contributions and leadership.'
Ahold operates over 400 stores in eight Latin American countries with sales of approximately USD 4 billion. Alongside Bompreço, it has several other ventures with strong local partners including Disco in Argentina, Santa Isabel in Chile, Peru and Paraguay, and La Fragua in Guatemala, El Salvador and Honduras. Royal Ahold operates approximately 7,000 supermarkets, hypermarkets and other store formats in the United States, Europe, Latin America and Asia with annualized sales approaching USD 50 billion.