PriceSmart Inc. (San Diego) said it is closing the warehouse club operations of PSMT Mexico S.A. de C.V. that it ran jointly with Grupo Gigante S.A. de C.V. (Mexico City). The closure is expected to be completed by February 28, 2005.
PSMT Mexico currently operates three membership warehouse clubs in Mexico. The joint venture will continue to have real estate assets and is evaluating various business strategies associated with those assets, including leasing, selling or further commercial development of the sites.
“Based on current financial projections, management believes that the closing of the Mexico operation should not result in any significant book loss for PriceSmart,” said chairman and interim ceo Robert Price, “and that going forward the elimination of losses from the Mexico operations will have a positive impact on the company’s future operating results.”
Grupo Gigante is Mexico’s third-largest retailer. It also has joint ventures in the country with RadioShack (Fort Worth, Texas), Office Depot (Delray Beach, Fla.) and Carrefour SA (Paris).