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The Daily Deal
Retailers Challenge Wal-Mart Deal
by Jaret Seiberg in Washington
October 26, 2002
Wal-Mart's planned acquisition of Amigo supermarkets in Puerto Rico draws a suit seeking to block the deal.
A group of food retailers in Puerto Rico filed a lawsuit Friday, Oct. 25, to block Wal-Mart Stores Inc.'s acquisition of the Amigo supermarket chain, arguing the deal would hurt consumers and small businesses.
The suit was filed in superior court in San Juan and requests a preliminary and permanent injunction against Wal-Mart. "Wal-Mart is conducting practices in violation of Puerto Rico antitrust law," the group said in a press release. "This is to the detriment of free competition and the detriment of consumers."
Federico Gonzalez-Denton, director of corporate affairs for Wal-Mart Puerto Rico Inc., said the company has not seen the suit. But he said the acquisition of Amigo would benefit competition on the island. "This transaction will enable us to bring our everyday low-price philosophy to even more communities in Puerto Rico," he said.
A hearing has not been set on the suit. The plaintiffs include Conchita Supermarkets, Ralph's Food Warehouse and Pueblo Supermarkets.
Wal-Mart agreed in February to acquire Amigo for an undisclosed price. The Federal Trade Commission is still investigating the deal. Of concern is whether Wal-Mart would dominate the food retail business through its ownership of Amigo and the Sam's Club chain of warehouse clubs.
Gonzalez-Denton said there is no timetable for completion of the investigations by the FTC or by Puerto Rico's justice department.