Doubledragon purchase of MerryMart stake OKd

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DoubleDragon Paves the Way into Retail with MerryMart Stake Acquisition

The Philippine Competition Commission (PCC) has cleared DoubleDragon Corp.'s acquisition of a significant stake in MerryMart Consumer Corp., marking a major milestone in the property developer's foray into the retail sector.

A Strategic Move into Retail

In a statement released on Thursday, the PCC announced its approval of DoubleDragon's P1.28-billion deal to purchase 35 percent of MerryMart. This strategic move marks a significant expansion into the retail sector for DoubleDragon, a real estate firm chaired by Edgar Sia II and Tony Tan Caktiong.

Competition Assessment

The PCC's Mergers and Acquisitions Office conducted a thorough assessment of the potential impact on competition in markets for the lease of commercial spaces and warehouse facilities to grocery stores and convenience stores in areas where DoubleDragon subsidiaries City Mall and Central Hub operate. The agency consulted with industry stakeholders, including major retail chain competitors, customers, and relevant government agencies, and concluded that the transaction is not likely to result in a substantial lessening of competition.

A Competitive Retail Landscape

The PCC's findings suggest that the retail landscape in the Philippines is highly competitive, making it challenging for any single player to dominate the market. With strong competitors active at both upstream and downstream markets, DoubleDragon and MerryMart remain effectively constrained from engaging in input foreclosure (restricting rivals' access to spaces or facilities) and customer foreclosure (limiting consumer choice in retail).

DoubleDragon's Expertise in Retail

As a real estate firm focused on retail complexes, office spaces, industrial hubs, and hospitality, DoubleDragon brings a unique set of skills to the retail space. Its key subsidiaries include CityMall Commercial Centers Inc., which operates a network of community malls, and CentralHub Industrial Centers Inc., a provider of industrial warehouse complexes.

MerryMart's Nationwide Presence

MerryMart, owned by Sia, operates a nationwide chain of supermarkets and convenience stores. This acquisition will enable DoubleDragon to leverage MerryMart's extensive network and expertise in the retail sector.

Market Reactions

In response to the news, DoubleDragon shares rose P0.17, or 1.89 percent, to P9.17 each on Thursday, while MerryMart shares surged 9.33 percent, adding 3.5 centavos to close at 41 centavos apiece, amid a 1.15-percent advance for the benchmark Philippine Stock Exchange index.

Speculating on the Future of Retail

As the retail landscape continues to evolve, it will be interesting to see how DoubleDragon's entry into the market will shape the future of retail in the Philippines. With its expertise in real estate and MerryMart's nationwide presence, DoubleDragon is poised to make a significant impact in the retail sector.

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Edward Lance Arellano Lorilla

CEO / Co-Founder

Enjoy the little things in life. For one day, you may look back and realize they were the big things. Many of life's failures are people who did not realize how close they were to success when they gave up.