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SHANGHAI - The Chinese government plans to merge the parent companies of its largest retailers to meet growing competition from foreign retail giants that are rapidly expanding in China, according to report citing a government official and industry sources.
The merger will combine the parent companies of Lianhua Supermarket Holdings Co., Hualian Supermarket Co., Shanghai No. 1 Department Store Co., and Shanghai Material Trading Centre Co. A holding company formed through the merger, reportedly to be called the Bailian Group, will be led by Zhang Xinsheng, chairman of Shanghai Yibai Group Co., the parent company of Shanghai No. 1.
According to reports, assets of the four merged companies will be reorganized into hypermarket, supermarket, convenience store, and department store units, preventing the local players from competing against each other, and helping them deal with competition from Wal-Mart, Carrefour, and other international retailing giants.