NEW YORK (Reuters) - Walmart Inc’s (WMT.N) urgency to stem market share losses to rivals around the world is driving it to partner with local players in the UK and India, even as it scales back in some other markets like Brazil.
The world’s largest retailer is in talks to merge its UK arm ASDA with J Sainsbury Plc (SBRY.L) in which it will hold a minority stake. Walmart is also looking to acquire a majority stake in India’s leading online retailer Flipkart for $10 billion to $12 billion after years of underperformance there.
The moves underscore Walmart’s renewed focus on catching up with competitors, ranging from grocer Aldi Inc to Amazon.com Inc (AMZN.O), in key international markets. The retailer’s underperforming international business contributed less than a quarter to its total revenue of $500.3 billion in fiscal 2018.
“Walmart has simply been too slow to react when it comes to their overseas business,” said Burt Flickinger, managing director, Strategic Resource Group. “They have finally started taking corrective action and are now dedicating their resources to where they think they can grow,” he said.
It also marks a shift in Walmart’s traditional approach of building a business on its own.
“Walmart is clearly moving away from trying to crack tough foreign markets by itself to striking partnerships because it realizes that is the fastest way to bridge the gap with competitors,” said Laura Kennedy, vice president, retail sales and shopper practice at Kantar Consulting.
A Walmart spokesman declined to comment on the negotiations in the UK and India.
Overall, sales from Walmart International, which runs about 6,300 stores globally, stood