The world's largest retailer, Walmart Stores (WMT), wants to get even larger: It has joined the bidding war for Indonesian retailer Matahari's hypermarket business, Hypermart, a deal that could be worth up to $1 billion, unnamed sources told Reuters on Thursday.

On Tuesday, the Financial Times reported that its sources revealed the Jakarta-listed Matahari Putra Prima had hired Bank of America Merrill Lynch (BAC) to review "all strategic options to maximize shareholder value," including a possible acquisition. Matahari is selling Hypermart, Indonesia's second-biggest hypermarket chain after PT Carrefour Indonesia.

The Financial Times reported that South Korea's second-largest retailer, Lotte Shopping, might be interested. Reuters added Walmart and private-equity firm The Carlyle Group to the list of those expected to compete in the auction: The winner will gain a major foothold in this emerging South Asian economy of 237 million people.

Reuters said that although Walmart had hired Barclays Capital (BCS) to advise it on the transaction, it was unclear whether the Dow component had submitted a formal offer.

While Walmart has been faring well in the recession and its sluggish aftermath, it faces diminishing growth prospects in the U.S. and has been looking to emerging markets to find opportunities for expansion.


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