Costco takes full ownership of Mexican unit
ISSAQUAH, WA and MEXICO CITY — Costco Wholesale has agreed to buy out Controladora Comercial Mexicana's 50% share interest in Costco de Mexico, a joint venture, for $10,650 million MXN (the equivalent amount in U.S. dollars is $760.4 million based on an exchange rate of 14.006 pesos to the dollar). In addition, Costco Mexico has declared a cash dividend of approximately $4,774 million MXN (the equivalent amount in U.S. dollars is $340.85 million based on an exchange rate of 14.006 pesos to the dollar), 50% payable to a subsidiary of Costco Wholesale and 50% to CCM. Costco Wholesale will use the dividend proceeds and existing cash and investment balances to fund the purchase. CCM will use the dividend and sale proceeds to pay down debt.
The Costco Mexico joint venture has been 50% owned by each of Costco Wholesale and CCM and operated by Costco Wholesale. The closing is subject to the approvals of the Mexican Federal Competition Commission and the shareholders of CCM. Guillermo Gonzalez Nova, and Carlos Gonzalez Zabalegui, respectively chairman and CEO of CCM, will continue as members of the board of directors of Costco Mexico. Jaime Gonzalez Solana will continue as CEO of Costco Mexico.
Costco Wholesale currently operates 602 warehouses, including 435 in the United States and Puerto Rico, 82 in Canada, 32 in Mexico, 22 in the United Kingdom, 13 in Japan, eight in Taiwan, seven in Korea and three in Australia. The Company also operates Costco Online, an electronic commerce web site, at www.costco.com and at www.costco.ca in Canada.