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FamilyMart UNY and Don Quijote are set to deepen their existing partnership in Japan.
Japanese discount retailer Don Quijote is planning to acquire the remaining 60% stake of UNY, after it had acquired 40% stake last year, to fully control the general merchandise store business. In exchange of UNY hypermarkets, FamilyMart UNY will acquire 20.2% stake in Don Quijote. The deal would add around 190 locations to Don Quijote's existing store network, surpassing its target for 500 stores by 2020. It currently operates more than 420 stores across Japan.
Should the deal go ahead, we expect Don Quijote to gradually convert, rebrand and integrate some of the UNY stores into its own distinctive store layout, product range and design. Reports suggest a final decision on could be announced as early as this month. Further collaboration between the two is also likely, in both convenience and hypermarket formats.
Only in June, the two retailers opened a convenience store together in the outskirts of Tokyo. Don Quijote already operates six strong performing MEGA Don Quijote UNY stores, with sales doubling after the alliance. The announcement of a potential deal may have come earlier than expected, but as large format retailers continue to reinvent their stores, the two companies have acted early to stay competitive amidst rising competition from speciality stores and online businesses.
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