Solid performers that buck the trend
When the largest retailer in the world takes a majority stake in the largest retailer in Mexico the resulting company is likely to have a powerful punch. Cifra is now effectively the Wal-Mart of Mexico, being 51% owned by the US retail group since March.
Cifra dwarfs the competition in Mexico. It is the largest mass merchandiser in terms of market capitalization, sales, number of stores, and selling space. With Wal-Mart behind it, it can improve its position even further by investing more in systems and distribution, quality staff and technology and by strengthening its purchasing power.
Wal-Mart's prominence, however, is not overshadowing Cifra's management. "It's a sign of confidence in local management that Wal-Mart didn't introduce any of its own management," says Marc de Speville, retail analyst at Robert Fleming. "They promoted a local employee to be CFO following the departure of the previous CFO to work for Televisa. When the CEO, Henry Davis, stepped down in March after 25 years at the helm of Cifra [he remains a member of the board] Wal-Mart decided not to replace him and left Jerónimo Arango as chairman."