A 50-50 joint venture between Ayala Land Inc. and Puregold Price Club Inc. will soon launch a new retail brand called “Merkado Supermarket.”
Mekardo Supermarket, which needs board approval from both companies, will be based in Ayala-run shopping malls and will target the middle-income segment.
The strategy of building mall-based supermarkets will enable Puregold, the current second largest supermarket chain, to tap a broader market as most of its supermarkets are stand-alone stores.
By venturing into mall-based supermarkets, Puregold and Ayala Land will directly compete with SM Retail, the leading supermarket chain owned by the Sy family, which has been the anchor supermarket for all SM shopping malls.
Based on initial plans, Merkado will be located within Ayala-owned shopping malls. At present Ayala Land’s shopping mall in Fairview, Quezon City has Puregold as its supermarket tenant.
Ayala Land’s Varejo Corp. and Puregold’s Entenso Equities signed a joint venture agreement last year to develop and operate mid-market supermarkets for some of Ayala Land’s new integrated and mixed-use developments.
However, it is only now that the joint venture partners unveiled their plans for the venture.