Wal-Mart Stores will buy the rest of ailing Seiyu as the U.S. retail giant seeks the flexibility it says it needs to turn around the money-losing supermarket chain.
Seiyu, Japan's fifth-biggest retailer by sales, said shareholders approved the move at a meeting earlier Tuesday. The vote allows Wal-Mart to buy the remaining 4 percent of Seiyu it doesn't already own.
Since entering the Japanese market in 2002, Wal-Mart has been gradually raising its stake in Seiyu, which has about 400 stores nationwide. But Wal-Mart has also struggled to make money in Japan. Although mall-style shopping is increasingly popular here, for everyday food and other needs, shoppers tend to go to smaller neighborhood stores.
In February, Seiyu reported a net loss of ¥20.93 billion for the year, underscoring the tough time Wal-Mart is having turning it around. Weak sales of clothing and other seasonal goods led to a 0.9 percent fall in revenue to ¥952.30 billion for the year, down from ¥960.86 billion a year earlier.
The poor performance suggests Wal-Mart's "Everyday Low Price" strategy has backfired in Japan, where consumers tend to equate low prices with low quality.