After years of struggling with fierce competition, Wal Mart is selling a majority stake in Japanese supermarket chain saiYou to investment firm KKR and e-commerce company Rakuten for more than $1bn. The deal, valued at 172.5 billion yen (US $1.65 billion), comes after rumors that the U.S. retail giant intends to exit the Japanese market. KKR, the investment company, will acquire 65% of the shares of Xiyou department store, while Lotte will buy 20% of the shares. Lotte has established an online joint venture with Xiyou department store. The two companies said in a joint statement on Monday that Wal Mart would retain a 15% stake. < p > < p > Wal Mart first entered the Japanese market after acquiring 6% of the shares of Xiyou department store in 2002, then gradually expanded its shares, and finally fully acquired Xiyou department store in 2008. However, like other outsiders such as Tesco and Carrefour, Wal Mart is struggling in Japan. These international supermarket chains are attracted by the high consumption power of Japanese consumers, but are frustrated by fierce local competition. < p > < p > some analysts said Wal Mart, though not making much money in Japan, outperformed other foreign retailers given that it saved the loss making unit Xiyou from bankruptcy by cutting costs and increasing its own brand sales. < / P > < p > “Wal Mart has been struggling because they have to turn around their business and they need to increase sales to really have a place in the Japanese market, and the only way to do that is through more acquisitions, but it’s not willing to spend any more,” says Roy Larke, who specializes in Japanese retailing. < / P > < p > for Lotte, the deal with Xiyou helps it fight back against rival Amazon. The company recently strengthened its online grocery business through a partnership with life Corp, a supermarket chain. “We look forward to accelerating the digital transformation of Xiyou’s physical retail and further integrating the advantages of offline and online retail,” Kazunori Takeda, executive vice president of Lotte Group, said in a statement Privacy Policy