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ZAANDAM, The Netherlands - Global retailer Ahold on Wednesday confirmed it is engaged in exploratory talks regarding the possible sale of its stake in its Chilean supermarket activities that trade under the Santa Isabel banner. The Peruvian and Paraguayan operations will not be part of this transaction, Ahold said. At year-end 2002, Santa Isabel operated 77 stores in Chile.
Ahold and Chilean retailer Cencosud S.A. must still agree on the terms of the final agreements. The parties intend to negotiate on the basis that these activities have a total value, not considering any liability, of approximately $150 million. The related book value, including goodwill, of the Chilean assets is approximately $220 million.
Cencosud has interests in real estate, do-it-yourself (DIY) stores and hypermarkets. Its wholly-owned subsidiary, Hipermercados Jumbo S.A., is the third-largest food retailer in the country with seven hypermarkets and 15 DIY stores. The company also operates 11 hypermarkets and 21 DIY stores in Argentina.
The possible divestment of its stake in its Chilean activities fits within Ahold's strategy announced Nov. 19, 2002. The strategy focuses on boosting growth in its profitable core businesses, reducing debt and rationalizing the portfolio.