Gigante Sells Radio Shack Stake

Grupo Gigante has sold its stake in Radio Shack to Tandy for MXP563.2m after the two did not reach an agreement on how to expand the chain in LatAm. Proceeds from the sale will likely be used to finance future acquisitions by Grupo Gigante. In a letter to the BMV, the company says proceeds will “complement and reinforce the consolidation and growth strategy.” Spokesmen from the companies could not say how the deal is being financed. According to Actinver analyst Marisol Huerta, Radio Shack contributed to 14% of Gigante’s revenue in 2007. She also says Gigante has $400m in cash, which allows the company to look for acquisition opportunities. Gigante recently said it would invest up to $50m to expand Office Depot de Mexico – in which it holds a 50% stake – to Colombia, possibly through acquisitions.