wal-mart de mÉxico, s.a.b. de c.v. prospectus … financiera/bmv/bmv... · prospectus on...

WAL-MART DE MÉXICO, S.A.B. DE C.V. Blvd. Manuel Ávila Camacho #647, Colonia Periodista,

Delegación Miguel Hidalgo, C.P. 11220,

México, D.F.

Tel. (52) 55 5283-0100

www.walmartmexico.com.mx

PROSPECTUS ON ACQUISITION OF WAL-MART CENTROAMÉRICA December 8, 2009

Pursuant to article 35 and Attachment P of the General provisions applicable to securities issuers and other players within the securities market, published in the Daily Official Gazette, dated March 19, 2003, as amended, (hereinafter “Provisons for Issuers”), Wal-Mart de México, S.A.B de C.V. (interchangeably known as either “Wal-Mart de México”, the “Corporation”, or the “Issuer”) informs its shareholders and the investor public of the acquisition of Wal-Mart Centroamérica.

Brief summary of the Transaction. Wal-Mart de México plans to acquire the totality of Wal-Mart Centroamérica operations. Consequently, the Issuer shall acquire 100% of the capital stock for TFB of WM Maya, S. de R.L. de C.V. (“WM Maya”) to be owned by TFB Corporation, N.V., current holder of Wal-Mart Centroamérica stock (“the Transaction”).

The Board of Directors for Wal-Mart de México has called a meeting of the Shareholders Assembly to present the transaction to its shareholders for their approval. The proposal is that the transaction be conducted through the merging of Wal-Mart Centroamérica into Wal-Mart de México, which will result in the issuance of Walmex shares, as well as a cash payment.

The Audit and Corporate Practices Committees for Wal-Mart de México –whose members are exclusively independent directors- during a meeting held on November 23rd of this year, decided to recommend that the Board approve this transaction, taking into account all relevant factors including that the Transaction would be beneficial for all Wal-Mart de México shareholders.

The Committees considered the participation of a related party –Wal-Mart Stores, Inc.– and concluded there would be no opposition to recommending the Transaction and approval thereof, due to the foreseeable benefits stemming from this transaction, the fact that the negotiations conducted and the terms and conditions agreed were all performed under market conditions, and that the Transaction is beneficial for the corporation and all its shareholders.

The Board of Directors for Wal-Mart de México, in a meeting held on November 23rd of this year, approved the Transaction.

The major part of the Transaction shall be paid through the issuance of new Walmex shares, wherein said issuance stems from the merging of both corporations. Wal-Mart Stores, Inc. and a considerable percentage of the minority shareholders for Wal-Mart Centroamérica have agreed to receive new shares issued by de Wal-Mart de México, whereas a lesser number of said shareholders have opted for a cash payment.

1 FREE TRANSLATION, NOT TO THE LETTER

The cash payment, which totals approximately $1.4 billion pesos, shall be paid by Wal-Mart de México resources. In order to compensate shareholders who opted for payment in shares, some 593 million new shares will be issued, which will not be subject to dividends, if the case, for the 2009 period. The amount of shares exchanged will stem from valuations relative to the merging companies.

Additionally, as part of the purchase price, subsequent payments will be made in cash and shares and therefore it is the intention of the Board to suggest to the Shareholder Assembly the issuance of a maximum of 55 million shares that shall remain as Treasury Stock, neither subscribed nor paid, to be delivered to current Wal-Mart Centroamérica shareholders, provided the acquired corporation meet the requirement of achieving specified profitability levels. In achieving such profitability goals, this transaction would produce an even greater effect for Wal-Mart de México.

Wal-Mart Centroamérica profitability shall be assessed annually, for a term that may be extended to ten years. Upon completion of said term, all Treasury Stock stemming from this transaction, and which has neither been subscribed nor paid, shall be cancelled.

Issuer Stock. Features before and after the Transaction. The shares representing Wal-Mart de México capital stock are ordinary, registered, and without expressed par value. The Transaction shall not be the cause for any change whatsoever to the characteristics and/or rights and obligations that Issuer shares impose on its holders.

Ticker Symbol. Representative shares of Wal-Mart de México capital stock are listed with the National Securities Registry (the “RNV”) and are traded on the Mexican Stock Exchange (the “MSE”), under ticker symbol “Walmex V”.

THE LISTING OF WAL-MART DE MÉXICO SHARES WITH THE RNV NEED NOT IMPLY VERIFICATION OF THE PROFITABILITY OF THE SECURITIES, ISSUER FINANCIAL SOUNDNESS, ACCURACY OR TRUTHFULNESS OF INFORMATION CONTAINED HEREIN, NOR DOES IT VALIDATE ACTIONS THAT, AS THE CASE MAY BE, MAY HAVE BEEN CONDUCTED IN VIOLATION OF ANY APPLICABLE LAWS.

The prospectus herein does not constitute the offering of securities in México. Said prospectus has been prepared and is made available to Issuer shareholders and any investors, pursuant to that set forth under applicable legislation and Corporate bylaws. It should be noted that the Transaction entails the merging of an entity having a specific purpose within the Corporation. Said merger must and shall be presented to Issuer shareholders, as per Company bylaws and legislation enforce. Copies of the prospectus herein are available for Company shareholders at the corporate offices. The e-version of said prospectus may be viewed at the Wal-Mart de México website: walmartmexico.com.mx, and the Mexican Stock Exchange homepage: www.bmv.com.mx

GUATEMALA

NICARAGUA

HONDURAS

COSTA RICA

ELSALVADORMÉXICOMÉXICO


http://walmartmexico.com.mx/

http://www.bmv.com.mx/


Page

1. GENERAL INFORMATION.....................................................................5

2. EXECUTIVE SUMMARY.........................................................................9 2.1. BRIEF DESCRIPTION OF WAL-MART DE MÉXICO....................................................................................9

2.2. BRIEF DESCRIPTION OF WAL-MART CENTROAMÉRICA...........................................................................9

2.3. BRIEF DESCRIPTION OF TRANSACTION ...............................................................................................10

3. DETAILED INFORMATION ON THE TRANSACTION.........................11 3.1. DETAILED DESCRIPTION OF THE TRANSACTION ...................................................................................11

3.2. TRANSACTION OBJECTIVES ...............................................................................................................12

3.3. FUNDING AND EXPENSES STEMMING FROM THE TRANSACTION ............................................................13

3.4. TRANSACTION APPROVAL DATE..........................................................................................................14

3.5. DATE FOR EXCHANGE OF SHARES .....................................................................................................14

3.6. RIGHTS OF SECURITIES BEFORE AND AFTER THE TRANSACTION ..........................................................15

3.7. ACCOUNTING TREATMENT OF THE TRANSACTION................................................................................15

4. INFORMATION REGARDING THE RELATED PARTIES INVOLVED IN THE TRANSACTION........................................................................16

4.1. WAL-MART DE MÉXICO .....................................................................................................................16

4.2. WAL-MART CENTROAMÉRICA ............................................................................................................29

5. RISK FACTORS....................................................................................39 5.1. RISK FACTORS RELATED TO WAL-MART DE MÉXICO ...........................................................................39

5.2. RISK FACTORS ASSOCIATED WITH THE TRANSACTION..........................................................................40

5.3. RISK FACTORS RELATED TO WAL-MART CENTROAMÉRICA .................................................................40

6. SELECTED FINANCIAL INFORMATION.............................................42 6.1. RESULTS..........................................................................................................................................45

6.2. FINANCIAL SITUATION, LIQUIDITY AND CAPITAL RESOURCES ...............................................................47


7. ANALYSIS OF RESULTS AND FINANCIAL SITUATION PROFORMA..........................................................................................48

8. PEOPLE IN CHARGE ...........................................................................49

9. ATTACHMENTS ...................................................................................50 9.1. REPORT OF INDEPENDENT AUDITORS ................................................................................................50

9.2. EXTRAORDINARY SHAREHOLDERS MEETING NOTICE, WAL-MART DE MÉXICO......................................88


1. GENERAL INFORMATION For purposes of this Prospectus, capitalized terms will have the following meanings. Said meanings will apply both in singular and plural.

“ADR” American Depositary Receipt

“ANTAD” Mexican National Retail Association

“Annual Report” Annual report issued by Wal-Mart de México for the fiscal year ended on December 31, 2008; filed before the CNBV and the MSE based on Issuing Company Provisions. The annual report can be accessed at: www.walmartmexico.com.mx and www.bmv.com.mx

“Associates” Wal-Mart de México collaborators

“Bodega Aurrerá” Austere discount stores offering basic merchandise, food, and household items at the best prices

“Central México” Consisting of the following states: Aguascalientes, Colima, Hidalgo, State of México, Guanajuato, Jalisco, Michoacán, Morelos, Puebla, Querétaro, San Luis Potosí and Tlaxcala

“CINIF” Mexican Financial Reporting Standards Research and Development Board

“ClubCo” Warehouse membership clubs, where members can purchase large volumes in institutional-size packages

“CNBV” Mexican National Banking and Securities Commission

“Despensa Familiar and Palí”

Discount stores that offer limited assortment at very low prices

“Devaluation” Mexican Peso devaluation against US dollar

“Distribution Center”

Location for the receipt of goods from suppliers and store distribution

“Dollar, Dollars, or US$”

Dollar, American legal currency

“EBITDA” Earnings Before Interest, Taxes, Depreciation, and Amortization

“Every Day Low Prices”

Permanent Wal-Mart de México philosophy which focuses on contributing towards improving the quality of life for Mexican families

“GDP” Gross Domestic Product

“Híper Paiz and Híper Más”

Hypermarkets that operate under the premise of one-stop shopping. Located in the periphery of, or main entrances to, large cities throughout Central America

“IETU” Mexican flat-rate business tax

http://www.walmartmexico.com.mx/

http://www.bmv.com.mx/


“Indeval” S.D. Indeval, Security Deposit Institution, S.A. de C.V.

“IPC” Price and Quotation Index

“ISO 9001:2000 Quality Standard”

Certification awarded a Company or any area of a Company that has implemented a system to ensure its products or services meet international quality standards as established by the International Standards Organization (ISO)

“ISR” Income Tax

“ISSSTE Stores” Social Security and Services Institute for Government Employees stores

“Issuer provisions” General dispositions regarding applicable securities issuing companies and other securities market participants published in the Official Gazette on March 19, 2003 and amended by resolutions published on October 7, 2003; September 6, 2004; September 22, 2006; September 19, 2008; January 27, 2009; and July 22, 2009 issued by the CNBV

“IVA” Value Added Tax

“LGSM” General Corporation and Partnership Law

“LGTOC” Law of Negotiable Instruments and Credit Operations

“LMV” Securities Market Law

“MaxiBodegas” Warehouse type stores, which are a different style of discount stores, larger in size and with a wider assortment, at equally competitive prices

“Metropolitan Area” Consisting of the following: México City and the Metropolitan Area

“México” United Mexican States

“Minority Shareholders of the Region”

Those shareholders who, prior to conducting the Transaction described herein, together hold the remaining 49% of Wal-Mart Centroamérica capital stock.

“MSE” Mexican Stock Exchange

“Net sales” Income stemming from goods sold in Wal-Mart de México stores

“NIF” Mexican Financial Reporting Standards issued by the CINIF.

“NCPI” National Consumer Price Index

“North” Consisting of the following states: Coahuila, Chihuahua, Durango and Zacatecas

“Northeast” Consisting of the following states: Nuevo León and Tamaulipas


“Northwest” Consisting of the following states: Baja California Norte, Baja California Sur, Nayarit, Sinaloa and Sonora

“Paiz, La despensa de Don Juan, La Unión and Más x Menos”

Supermarkets focused on customer service in large urban centers, or the surrounding areas

“Pesos, pesos or $”

Pesos, Mexican legal currency

“Prospectus” Information statement regarding the corporate restructuring which was prepared by Wal-Mart de México pursuant to article 35 and Attachment P of the Issuing Company Provisions

“PTU” Employee Profit Sharing

“Related Parties, or Related People”

According to Article 2, section XIX of the LMV these are: (i) people controlling or having an influence on a Company which is part of the business group to which the issuing Company belongs, including directors, managers, and other relevant officers from said business group; (ii) people with a position of power within a Company that is part of the business group to which the issuing Company belongs; (iii) spouse, common law spouse, or a relative by blood or marriage (fourth degree) or by affinity (third degree) with individuals who are defined under sections (i) and (ii) hereinabove, or the partners or joint owner of the individuals mentioned in said sections and with whom there is a business relationship; (iv) companies that are part of the business group to which the issuing Company belongs; (v) companies over which any of the persons and/or entities outlined under sections (i) to (iii) have significant control or influence.

“RNV” CNBV’s Securities Registry

“Sales Floor” Surface area set aside for merchandise retail

“Sam’s Club” Membership warehouse clubs aimed at businesses and consumers who seek the best possible prices

“SEC” US Securities and Exchange Commission

“SEDI” Electronic system to send and convey information to MSE

“SKU” Stock-keeping units

“Southeast” Consisting of the following states: Campeche, Quintana Roo, Tabasco, Veracruz and Yucatán

“Southwest” Consisting of the following states: Guerrero, Chiapas and Oaxaca

“Suburbia” Apparel stores offering the best in fashion for the whole family at the best possible price

“Superama” Supermarkets located in residential areas


“Transaction” Corporate restructuring described in the Prospectus herein

“TFB” or “TFB Corporation N.V.”

Entity shall own 100% of Wal-Mart Centroamérica shares, and which shall become a subsidiary of WM Maya prior to completing the Transaction

“Total Revenues” Net sales plus other income

“UNAM Stores” National Autonomous University of México stores

“United States” United States of America

“Vips” Leading restaurant chain in the restaurant-cafeteria segment. It includes Mexican cuisine as represented by El Portón

“Wal-Mart Centroamérica”

The group of corporations comprising Wal-Mart Centroamérica, currently controlled by TFB and to be owned by WM Maya, who in turn shall be merged with Wal-Mart de México as a result of the Transaction.

“Wal-Mart de México”

Wal-Mart de México, S.A.B. de C.V.

“Wal-Mart de México Bank”

Banco Wal-Mart de México Adelante, S.A., Institución de Banca Múltiple

“Wal-Mart Stores” Wal-Mart Stores Inc., a retail chain in the United States

“WM Maya” The corporation shall own TFB and therefore Wal-Mart Centroamérica, and to be merger with Wal-Mart de México

“Walmart” Hypermarkets providing the widest assortment of goods from groceries and fresh, to apparel and general merchandise

“Walmex” Ticker symbol for Wal-Mart de México, S.A.B. de C.V.

“Working Day” Any day the Mexican Stock Exchange is open for business


2. EXECUTIVE SUMMARY The following summary includes a brief description of the most relevant aspects of the transaction and in no way does it intend to completely detail all the information that could be of relevance for the corporate restructuring described herein. The information included herein will be supplemented with more detailed information and the financial information included in the other sections of this Prospectus, as well as in the Annual Report for Wal-Mart de México filed with the CNBV and the MSE, which are available at the Company’s website www.walmartmexico.com.mx and on the MSE website www.bmv.com.mx.

2.1. Brief description of Wal-Mart de México Wal-Mart de México is one of the most important retail chains in Mexico. As of November 30, 2009, it operates 1,398 units, including self-service stores, membership warehouse clubs, apparel stores, and restaurants as well as 119 bank branches. It has presence in 256 cities throughout the 32 states of México.

During the first 11 months of 2009, the Company opened 169 Bodegas Aurrerá, 15 Walmarts, 7 Sam’s Clubs, 3 Superamas and 3 Suburbias, thereby achieving a historical record of grand openings: 270 units, 18 more than what was planned at the beginning of the year.

Wal-Mart de México (WALMEX) is listed with the MSE since 1977. It is one of the most important companies on the IPC. Its capitalization value as of November 30, 2009 was of $444.1 billion pesos, represented by 8,382 million outstanding shares.

2.2. Brief description of Wal-Mart Centroamérica

Wal-Mart Centroamérica dates back to September 2005, when Wal-Mart Stores Inc. (leading retailer in the world, which began its operations in 1960) acquired 33% of the shares of Central American Retail Holding Company (CARHCO) from the Dutch retailer Royal Ahold N.V. Wal-Mart Stores Inc., thus began its business relations with the three operating companies that formed part of the original Company: La Fragua, founded in Guatemala in 1928, by Carlos Paiz Ayala; CSU, founded in Costa Rica in 1960, by Enrique Uribe Pagés; and Corporación de Compañías Agroindustriales (CCA), a supplier of fresh meat, vegetable and bakery goods and private label products sold in its stores.

In March of 2006, Wal-Mart Stores increased its holdings to 51%, and the CARHCO name was replaced with Wal-Mart Centroamérica.

The results achieved for Wal-Mart Centroamérica in 2008 were the highest in its history.


Wal-Mart Centroamérica is the leading retailer in the region. By November 30, 2009, it has 519 units in operation –including discount stores, austere warehouse stores, supermarkets, hypermarkets, and membership warehouse clubs -distributed throughout 5 countries: Guatemala, Honduras, El Salvador, Nicaragua and Costa Rica.

2.3. Brief description of Transaction The current holdings in Wal-Mart Centroamérica are as follows:

Wal-Mart Stores: 51%

Minority shareholders in the region: 49%

Total 100%

Through a merger process, Wal-Mart de México would be acquiring 100% of Wal-Mart Centroamérica capital. In exchange it would issue up to 593 million new shares and pay approximately $1.4 billion pesos in cash, to be distributed among the current shareholders: Wal-Mart Stores and the minority shareholders in the region.

Additionally, as part of the purchase price, subsequent payments will be made in cash and shares and therefore it is the intention of the Board to suggest to the Shareholder Assembly the issuance of a maximum of 55 million shares that shall remain as Treasury Stock, neither subscribed nor paid, to be delivered to current Wal-Mart Centroamérica shareholders, provided the acquired corporation meet the requirement of achieving specified profitability levels. Upon achieving such profitability goals, this Transaction would produce even better effects for Wal-Mart de México.

It should be noted that this transaction will not cause Wal-Mart de México to incur in any interest-bearing debt.

Therefore, 100% of the capital stock for Wal-Mart Centroamérica will be owned by Wal-Mart de México, whose capital shall be integrated as follows:

• 68.5% owned by Wal-Mart Stores

• 31.5% will continue trading on the MSE

3. DETAILED INFORMATION ON THE TRANSACTION

3.1. Detailed description of the Transaction The Transaction includes the indirect acquisition of Wal-Mart Centroamérica, by purchasing 100% (one hundred percent) of WM Maya capital stock, through a merger, who shall own TFB, who in turn, shall own 100% (one hundred percent) capital stock of the subsidiary, Wal-Mart Centroamérica. The Transaction will be conducted through two corporate transactions, including:

1. TFB shares held by Wal-Mart de Centroamérica shareholders (the “Sellers”) shall be transferred to a recently incorporated limited liability Company -known as WM Maya, S. de R.L. de C.V. (“WM Maya”)- which shall act as a Mexican instrument to conduct the Transaction. The Sellers will receive partnership interest at WM Maya as consideration for TFB shares, at market value. Furthermore, the Minority Shareholders of the Region shall receive promissory notes for their partnership interest in WM Maya. The Sellers thereof have entered into a Purchase Agreement, which is subject to certain conditions, such as the approval of the Transaction by Wal-Mart de México Shareholders and the corresponding government authorities.

51%49%

Minority Shareholders of the Region CARCROFT

WM Maya

TFB

51%49%

Minority Shareholders of the Region CARCROFT

WM Maya

TFB

2. Once the Sellers have transferred all of their TFB shares to WM Maya, Wal-Mart de México and WM Maya will have merged with the surviving corporation, Wal-Mart de México -the acquiring corporation- and WM Maya -the acquired corporation- will have disappeared.



If the merger between Wal-Mart de México and WM Maya is approved, it would have the following effects:

• The extinction of WM Maya

• The increase in the number of shares representing Wal-Mart de México capital stock, with the understanding that new Wal-Mart de México shares issued will be delivered to WM Maya partners in exchange for the merger. Said new shares shall not be subject to dividends for results achieved in 2009, if the case.

• The strengthening of Wal-Mart operations in Latin America

Pursuant to that stipulated in Article 224 and following the LGSM, the merger shall be enforced three months after the merger agreements have been submitted and filed with the Public Commercial Registry that corresponds to the corporation’s legal domicile; or when submitted providing payment for all merging corporations debts has been negotiated; or if the amount corresponding all the debts has been deposited at a credit institution; or by agreement of all creditors.

Shareholders are being asked to approve the merger for this Transaction, which would then be enforced once the merger agreements have been filed with the Public Commercial Registry. Term debts shall be considered as due, for this purpose. The merger shall be enforced after the agreements are filed with the Public Commercial Registry in México City, given that Wal-Mart de México and WM Maya agreed to the payment of the debt to whomever requires, if the case.

Pursuant to the LGSM, the corporations involved in the merger will publish the merger agreements as well as WM Maya and Wal-Mart de México general balance sheets in the Official Daily Gazette.

3.2. Transaction Objectives The primary objective of the Transaction consists of increasing the value for Wal-Mart de México shareholders through the acquisition via the merging of a leading retail Company in the Central American region, one which has great potential for growth, operating synergies and best practices.

Should the Transaction take place, Wal-Mart de México would increase outstanding shares by 7%, obtaining the following growth under the major profit and loss line items1:

Sales: 17.3%

EBITDA: 11.6%

1 Pro form, nine-month period on September 30, 2009


In addition to the aforementioned financial parameters, the operating environment for Wal-Mart Centroamérica is quite similar to that of Wal-Mart de México:

• Leading companies in their respective markets:

o Multiformat

o Suppliers in common

• A price-conscious consumer

• The same language and similar cultures

• A young and growing population

• A broad informal sector

It should also be noted that for the first time in its history, Wal-Mart Stores is entrusting another Company with both the opportunity and responsibility of operating one of its businesses in another region.

Wal-Mart de México would become an international Company, thus considerably broadening its horizon for its growth and expansion.

This transaction is equally important for the Minority Shareholders of Wal-Mart de México; without the need for any additional investment on their behalf, they shall reap the incremental benefits of a profitable transaction above and beyond the existing operation.

3.3. Funding and expenses stemming from the Transaction

3.3.1. Funding Wal-Mart de México shall assume the corresponding payments, related to the implementation of the Transaction, through the use of own resources and the exchange of new Issuer shares. Therefore, there will be no financing sources such as third-party credits who are not involved in the Transaction.

3.3.2. Expenses stemming from the Transaction Regarding the Transaction, and during its implementation, Wal-Mart de México shall incur expenses and fees of different origin, including: (a) legal, with the hiring of legal consultants to participate in drafting and negotiating documents, agreements, and other instruments related to the Transaction; (b) administrative, with the preparation of reports, projections and internal analysis for the Transaction; and/or (c) corporate, including payments of duties required by the Public Commercial Registry, among others.

Transaction expenses would amount to some $5.0 million dollars.


3.4. Transaction approval date

3.4.1. Audit and Corporate Practices Committees Pursuant to paragraph III(b) under article 28 of the LMV, the Transaction is considered one between Related Parties and therefore received a favorable opinion from the Corporate Practices Committee and the Audit Committee for Wal-Mart de México.

The Audit and Corporate Practices Committees, exclusively formed by independent directors, met on November 23, 2009, and resolved to recommend the Board to approve this Transaction, considering all relevant factors, including the fact that the Transaction is beneficial for all Wal-Mart de México shareholders.

The Committee considered the participation of a related party –Wal-Mart Stores, Inc.– and concluded that, given the benefits foreseen in the Transaction, the negotiations were carried out and the terms and conditions of the Transaction were stipulated based on market conditions; thus, the Transaction is beneficial for the corporation and all its shareholders; there is no impediment to recommend the Transaction and should be executed.

3.4.2. Board of Directors Moreover, and in keeping with the provisions set forth under paragraph III(c) of Article 28 of the LMV, and paragraph III of Article 40 of the same Law, the Transaction was presented for approval by the Board of Directors of Wal-Mart de México.

On November 23, 2009, the Board of Directors for Wal-Mart de México authorized the Transaction and the conducting of all corporate procedures necessary with the purpose of presenting the Transaction for approval by Wal-Mart de México Shareholders.

3.4.3. Extraordinary Shareholders Meeting Upon obtaining the aforementioned corporate authorizations on December 7, 2009, there was a call to an Extraordinary Shareholders Meeting for Wal-Mart de México with the purpose of approving the Transaction. Said call to meeting was published in “Reforma”, a nationwide newspaper. The Extraordinary Shareholders Meeting shall be held on December 22, 2009, at 9:30 AM, at Wal-Mart de México corporate offices. A copy of the call to said meeting is attached hereto as Annex 9.2.

3.5. Date for Exchange of Shares Upon approval during the Extraordinary Shareholders Meeting and execution of the Transaction, deemed to occur no later than March 31, 2010, the exchange of


partnership interest of WM Maya for shares Class “2”, Series “V” of the Issuer, shall take place.

3.6. Rights of Securities before and after the Transaction The Transaction shall not imply any change whatsoever to corporate or economic rights of Wal-Mart de México shareholders.

3.7. Accounting treatment of the Transaction For accounting purposes, this transaction is classified as a business acquisition, as it shall take place at market value, and pursuant to NIF B-7 revised and enforced as of January 1, 2009. Said transaction shall therefore be subsequently recorded under the “purchase method”.

The consideration to be paid by Wal-Mart de México consists of cash as well as the issuance of own shares of common stock, which pursuant to NIF B-7 shall be priced at fair value on the date on which control of the acquired corporation is final. Moreover, there shall be fixed annual payments for a period of 5 years, as well as a contingent payment that hinges on the accomplishing of certain financial objectives in the future, to be posted as a liability priced at fair value; in other words, at present value on the acquisition date. Any and all expenses related to the acquisition do not constitute part of the consideration and shall be posted to profits and losses on the date incurred.

In accordance with NIF B-7, the totality of all identifiable assets (including intangibles) and all liabilities for the acquired corporation are posted at fair value on the date of acquisition. The goodwill is recognized when the sum for the consideration priced at its fair value –as mentioned in the paragraph herein above- is greater than the net assets for the acquired business.

NIF B-7 sets forth that the Company shall have one year as of the acquisition date to establish the value of the net assets at fair value.

The identified goodwill shall not be amortized, but shall be subject, however, to impairment tests at least once a year. For impairment computation shall be determined pursuant to the guidelines set forth in NIF C-8 “Intangible Assets” which establishes how to assign goodwill for the tests of impairment, pursuant to Bulletin C-15 “Impairment in long-lived assets”. Moreover, that set forth in NIF B-15 “Foreign Currency Translation” must be taken into account for the purpose of foreign currency stemming from fair values of acquired net assets, as well as from the goodwill in the consolidated financial statements.

4. INFORMATION REGARDING THE RELATED PARTIES INVOLVED IN THE TRANSACTION

4.1. Wal-Mart de México

4.1.1. Name of the Issuer Wal-Mart de México, S.A.B. de C.V.

4.1.2. Business Description Wal-Mart de México is one of the most important retail chains in our country. It operates 1,398 units, including self-service stores, membership warehouse clubs, apparel stores, and restaurants as well as 119 bank branches as of November 30, 2009. It has presence in 256 cities throughout the 32 states of México.

Despite the unfavorable economic environment experienced in 2009, Wal-Mart de México has obtained very positive results, once again achieving the best results in its history.

Financial Data(12-month period ended in September)

Million of pesos Growth2009 2008* %

Results

Net sales 261,826 238,445 9.8

Other income 988 857 15.3

Total revenues 262,814 239,302 9.8

Gross profit 57,140 51,876 10.1

General Expenses 35,498 32,486 9.3

Operating income 21,642 19,390 11.6

EBITDA 26,121 23,449 11.4

Income before income tax 21,686 20,230 7.2

Net income 15,990 14,461 10.6

FINANCIAL POSITION (September)

Cash 13,511 7,408 82.4

Inventories 20,749 19,970 3.9

Other assets 3,682 3,819 (3.6)

Fixed assets 82,441 76,505 7.8

Total assets 120,383 107,702 11.8

Suppliers 24,038 22,526 6.7

Other liabilities 18,110 15,137 19.6

Shareholders’ equity 78,235 70,039 11.7

Total liabilities and shareholders’ equity 120,383 107,702 11.8* Historial values for the 4th Quarter of 2007 were considered for comparison purposes.

Wal-Mart de México


Total revenues generated in the last 12 months amounted to $262.8 billion pesos, once again establishing a new record for the Company. Sales growth was recorded at 9.8% total units and 2.9% comp units.

A new record high was also set in customer count: 1,174 million customers, thus representing a growth rate of 12.9%, in the last 12 months at September 2008.

Wal-Mart de México has a sound financial position. After investments made with own resources -that is, $6.1 billion pesos in modernizing and expanding our installed capacity, and the payment of dividends for $5.0 billion pesos- the Company has $13.5 billion pesos in cash and the balance has no debt, or any derivatives, as of September 30, 2009.

All business formats are growing, each one meeting the unique needs of their specific target markets. During the first 11 months of 2009, there were 169 Bodegas Aurrerá, 15 Walmarts, 7 Sam’s Clubs, 3 Superamas and 3 Suburbias stores. Therefore, by November 30, 2009, there were 1,398 operating units, all of which are located in 256 cities throughout the 32 states of México.

Number of UnitsDecember Grand Closes November

2008 Openings 2009

Bodega Aurrerá 442 169 1 610

Walmart 153 15 168

Sam’s Club 91 7 98

Superama 67 3 1 69

Total self-service 753 194 2 945

Suburbia 84 3 1 86

Vips 367 367

TOTAL 1,204 197 3 1,398 Wal-Mart de México is committed to its country, leveraging the huge opportunities for a self-service Company. This is made clear by the fact that by the end of 2009, Wal-Mart de México will reach a historical record of openings: 270 units, 18 more than what was considered at the beginning of the year.

Wal-Mart de México (WALMEX) is listed with the Mexican Stock Exchange since 1977. It is one of the most important companies on the IPC. Its capitalization value as of November 30, 2009 was $ 444.1 billion pesos, represented by 8,382 million outstanding shares.


Top Ten Companies in the MSEMillion pesos

Ticker Symbol Capitalization Total Revenues Employees30-Nov-09 12 months sep 09 Sep-09

1 América Móvil AMX 1,013,026 382,027 54,140

2 Wal-Mart de México WALMEX 444,099 262,814 174,486

3 Grupo México GMEXICO 236,742 62,573 18,271

4 Grupo Modelo GMODELO 218,543 80,366 36,971

5 Teléfonos de México TELMEX 211,979 120,321 53,116

6 FEMSA FEMSA 208,022 191,748 122,205

7 Carso Global Telecom TELECOM 186,657 204,150 78,665

8 Telmex Internacional TELINT 179,233 86,289 28,160

9 Grupo Televisa TLEVISA 149,993 51,661 22,377

10 Grupo Elektra ELEKTRA 139,164 42,790 35,483Source: Mexican Stock Exchange (MSE) and Bloomberg

a) Multiple Format Operation Note: % of total sales, sales, SKU and number of associates are figures as of the end of 2008. Square meters of sales floor, number of units and cities with presence are of November 30, 2009.

Austere discount stores offering basic merchandise, food and household items at the best price. There are three new prototypes to better serve its customers, as per the size of the community: Bodega Aurrerá, Mi Bodega Aurrerá, Bodega Aurrerá Express. Value proposition: price

33.7% total sales $ 82.3 billion pesos in sales 610 units 16,273,229 sq. ft. of sales area 45,000 SKUs 60,038 associates 235 cities nationwide 169 grand openings during 2009

Hypermarkets providing the widest assortment of goods from groceries and fresh, to apparel and general merchandise. Value proposition: price and assortment

28.2% total sales $ 68.7 billion pesos in sales 168 units 14,678,375 sq. ft. of sales floor 90,000 SKUs 47,060 associates 64 cities nationwide 15 grand openings during 2009

Membership warehouse clubs focused on businesses and consumers who seek the best possible prices. Value proposition: price leader, volume, new and unique merchandise

423,

27.0% total sales $ 66.0 billion pesos in sales 98 units 7,841,265 sq. ft. of sales floor

,500 SKUs 039 associates

60 cities nationwide 7 grand openings during 2009

Supermarkets located in residential areas. Value proposition: quality, convenience and service

5.1% total sales $ 12.4 billion pesos in sales 69 units 1,219,691 sq. ft. of sales floor 30,000 SKU 9,618 associates 14 cities nationwide 3 grand openings during 2009


Apparel stores offering the best in fashion for the whole family at the best possible price. Value proposition: fashion with the best value, price-quality ratio

3.6% of total sales $ 8.8 billion pesos in sales 86 units 3,839,584 sq. ft. of sales floor 8,848 associates 31 cities nationwide 3 grand openings during 2009

Leading restaurant chain in the restaurant-cafeteria segment. It includes Mexican cuisine as represented by El Portón. Value proposition: convenience, flavor and quality

2.4% total sales $ 5.8 billion pesos in sales 367 units 83,810 seats 20,315 associates 65 cities nationwide none grand openings during 2009

Universal banking institution aimed at Wal-Mart México customers, with an initial offering of basic banking and financial products and services. Value proposition: convenience, simplicity and price

119 Bank Branches 115,000 customers 1,096 associates 12 cities nationwide 81 grand openings during 2009

As of November 30, 2009, the Company had presence in 256 cities nationwide, distributed by geographical area as follows:

Presence by Geographical Region

Total Metropolitan area Center Southeast Northeast North Northwest Southwest

Bodega Aurrerá 610 229 203 53 30 33 23 39

Walmart 168 42 44 17 19 18 22 6

Sam’s Club 98 20 27 15 9 8 12 7

Superama 69 44 21 4

Total self-service 945 335 295 89 58 59 57 52

Suburbia 86 40 23 10 6 3 1 3

Vips 367 179 80 43 18 15 17 15

TOTAL 1,398 554 398 142 82 77 75 70


METROPOLITAN AREA

NORTH

NORTHWEST

CENTER

SOUTHEAST

SOUTHWEST

NORTHEAST

METROPOLITAN AREA

NORTH

NORTHWEST

CENTER

SOUTHEAST

SOUTHWEST

NORTHEAST

b) Cyclical Performance The demand for goods and services increases significantly during the last few months of each year as a result of the holiday season. In 2008, the fourth quarter represented 29.7% of the year’s total revenues, as well as 33.9% of operating income.

Revenues by QuarterTOTAL REVENUES 2008 CONTRIBUTION

(Billion pesos) %

1st Quarter 57.2 23.3

2nd Quarter 57.4 23.4

3rd Quarter 57.7 23.6

4th Quarter 72.7 29.7

TOTAL 244.9 100.0 Vacation periods and official holidays also have a significant impact on sales performance.

c) Distribution Channels As of November 30, 2009, Wal-Mart de México had 13 distribution centers with an installed capacity of more than 18.4 million square feet, allowing to transport 3.6 million cases to stores, clubs and restaurants each day.


Distribution CentersCity Name Service

México Cuautitlán Dry goods

La Naranja Apparel distribution for Suburbia

San Martín Obispo (2) Dry goods / Perishables

Comisariato Distribution for Vips

Santa Bárbara Dry goods

Chalco Dry goods

Monterrey Dry Dry goods

Perishables Produce

Guadalajara Dry Dry goods

Perishables Produce

Villahermosa Dry / Perishables Dry goods / Perishables

Culiacán Dry Dry goods d) Patents, Permits, Brands and Other Agreements

All commercial brands for the different business formats (Walmart, Sam’s Club, Superama, Bodega Aurrerá, Mi Bodega Aurrerá, Bodega Aurrerá Express, Prichos, Suburbia, Vips, El Portón, Ragazzi, El Malecón, La Finca, San Remo Café and Banco Wal-Mart de México Adelante), as well as the products bearing the private labels (Great Value, Equate, Members Mark, GRX, Weekend, MC Metropolis Company, Non Stop, Gianfranco Duna, etc.), are registered trademarks belonging to Wal-Mart Stores, Inc. and Wal-Mart de México, S.A.B. de C.V. Said trademarks are used by the operating companies under license agreements and/or sub-license agreements for an indefinite term. The Company also uses brands registered to third parties through license agreements, usually for an indefinite period of time, with guarantees on use and compliance with all applicable legislation.

The legal use and preservation of the rights of private labels is of great importance to the issuer, because they are considered part of the Company’s value, and the consumer identifies the quality of the products under said brands, together with the service provided by the operating companies, as part of the prestige of the Corporation.

“Vips” is one of the main brands of the group under which several restaurants operate. Seven franchises have been granted to operate restaurants in five different cities nationwide (Mérida, Oaxaca, Tuxtla Gutiérrez, Veracruz and Xalapa), which expire between 2010 and 2013, and without the execution of an industrial agreement.

“Banco Wal-Mart de México Adelante”, which operates a low cost bank in order to serve better our customers, is also part of the brands.


e) Primary Customers Wal-Mart de México’s primary consumer is the general public. Throughout 2008, we served 1,073 million customers.

México is a country with great diversity, differing demographics, preferences and income levels. The Company’s multiple-format strategy allows sufficient flexibility to efficiently meet the needs of the different population sectors.

E D D+ C C+ B/A%

33.7

28.2

27.0

5.1

3.6

2.4

Walmart

Sam’s Club

Superama

Suburbia

Vips

Bodega Aurrera

Walmart Bank

Population breakdown by income level

BUSINESSMEMBERS

(%)of total

sales

High: 7 .5Middle: 32.2%Low: 60.3%

f) Applicable Legislation and Tax Situation Wal-Mart de México, S.A.B de C.V., is a corporation established under Mexican law that complies with all legal provisions for the construction and operation of its units, with special emphasis on: environmental and ecological construction, urban development, operation, hygiene, the sale of alcoholic beverages, animal and pest control, and advertisements, pursuant to all applicable federal, state and municipal regulations.

Furthermore, Wal-Mart de México complies with basic principles of trade governing the relationship between suppliers and consumers established by the Federal Consumer Protection Law.

Wal-Mart de México is registered with the Ministry of Finance and Public Credit under the regime for large taxpayers, with its results consolidated for tax proposes, with the exception of the bank. The Company complies with all the tax provision regarding the development of the Corporation.

The primary laws governing Wal-Mart de México are: the Securities Market Law, General Corporation and Partnership Law, Income Tax Law, Value-Added Tax Law, Tax on Cash Deposit Law, Special Production and Services Tax Law, Intellectual Property Law, Federal Consumer Protection Law, Federal Anti-Trust Law, Foreign Investment Law, Banking Law and the Flat-rate Business Tax Law.



g) Human Resources Talent development is one of Wal-Mart de México strategic priorities and a core part of the business. During 2008, the Company created 12,582 new direct jobs, thus taking our associate headcount to 170,014, and ratifying the Company as one of the largest private-sector employers in the country. More importantly, the jobs created constitute development and growth opportunities for new associates, in an atmosphere of respect and equality.

During 2008, the Company invested some 9.6 million man-hours in training, of which an ever growing amount of 2.7 million was done through distance learning. Because of the Company’s new e-learning system, training and corporate programs have been facilitated by taking it straight to the units where our associates work, with considerable savings in time and energy by eliminating the need for traveling to a training center. As a result of these business practices and the continuous motivation of our associates, 23,879 were promoted throughout the year, and 6,278 were transferred to work centers closer to their homes.

Gender Equality

Female 53%

Male 47%

h) Environmental Performance

Wal-Mart de México wants to ensure that its daily operations guarantee environmental care and conservation. Therefore, it is constantly promoting sustainability among customers, associates and suppliers.

– In order for the Company to achieve the objective of reducing energy use per square meter, a series of initiatives were launched including the replacement of lighting with efficient lamps and installing energy control devices, the incorporation of high-efficiency electrical equipment in all new projects and remodels. Reducing 1.5% in energy use in 2008 represented almost 11,000 tons less of CO2, equivalent to removing some 2,000 motor vehicles from the roads for a full year.

– Aware of the Company’s commitment to products that help protect the environment and save customers money, the Company continues working with suppliers to identify and develop green products, that is, organic, recycled or biodegradable, and energy and water saving products.

– The Company promotes more austere sizes and packaging with suppliers, using less cardboard, which prevents tree felling and allows for the transportation of a greater number of products in fewer trips and with less


toxic emissions into the air. It also results in a lower product costs, thereby benefiting the customer.

i) Market Information Wal-Mart de México is a retail Company that operates self-service stores, membership wholesale clubs, apparel stores, restaurants and bank throughout the country.

The market it competes in is formed by:

– Establishments with a sales area of more than 600 square meters, three or more exit lanes and scanning technology, as well as independent self-service stores with one or two exit lanes an a sales area no greater than 600 square meters, such as: Soriana, Comercial Mexicana, Chedraui, Casa Ley, Futurama, San Francisco de Asis, HEB, Almacenes Zaragoza, Casa Chapa, Central Detallista, Comercial V.H., among others.

– Convenience stores, opened 15 or more hours a day, such as: Oxxo, 7 Eleven, Extra, Super 7, Mode, Super Rapiditos, Bip-Bip, Mercados Mexicali, Super Flash, Super K, Super Deli, Supers del Río, Super Tiendas del Hogar, Super Fiesta, Círculo K, Super Dos, Comextra, JV, Matador, On the Run, Super Tip, etc.

– Apparel and specialized stores, such as: Coppel, El Palacio de Hierro, El Puerto de Liverpool, Sears Roebuck, Sanborns Hermanos, Famsa, Elektra, Home Depot, Office Max, Office Depot, Zara, Radio Shack, Singer, Deportes Martí and Best Buy.

– Membership warehouse clubs, such as: Costco, City Club and Chesuma, among others.

– Establishments operated by public agencies, such as: ISSSTE, UNAM, etc As of December 2008, ANTAD membership included 99 retail chains with 17,024 stores, of which 2,815 are self-service, 1,362 are apparel and 12,847 specialized chains. Its installed capacity reached 17.3 million square meters and through out 2008 posted sales for $747 billion pesos2.

Nevertheless, a major part of the population in our country customarily shops in traditional establishments, such as municipal markets, open-air markets, grocery stores and mom-and-pop businesses, or through the informal sector of the economy. Both maintain a high market share since they are able to supply populations that, due to mere numbers, cannot access other establishments.

Growth, systems, logistics and distribution investments are focused on increasing and modernizing our installed capacity and distribution. This leads to a more efficient operation, with lower costs, allowing us to serve our customers better

2 Source: ANTAD. Media Report 2009

every day. Wal-Mart de Mexico maintains its position within the industry by maintaining the competitive advantages.

j) Corporate Structure Wal-Mart de México S.A.B. de C.V., is listed in the Mexican Stock Exchange whose major shareholder is Wal-Mart Stores, Inc., through Intersalt, S. de R.L. de C.V., holding 69.1% of the shares by December 31, 2008. The remaining 30.9% are held by the market.

As of November 30, 2009, the Company’s market value totaled $444.1 billion pesos.

WALMEX has a 99.9% equity interest in the following groups of companies: Wal-Mart de México

GROUP LINE OF BUSINESS

Nueva Wal-MartOperation of 610 (442 in 2008) Bodega Aurrera, discount stores, 98 (91 in 2008) Sam's Club membership self-service wholesale stores, 168 (153 in 2008) Walmart hypermarkets and 69 (67 in 2008) Superama supermarkets

Suburbia Operation of 86 (84 in 2008) Suburbia stores with apparel and accessories for the entire family.

VipsOperation of 267 Vips restaurants serving international cuisine, 93 restaurants El Porton restaurants serving Mexican food and 7 restaurants specializing in Italian food, during both years.

Comercializadora México Americana Import of goods for sale.

Real estate Real estate developments and management of real estate companies.

Services companies Rendering of professional services to Group companies, not-for-profit services to the community at large and shareholding.

Banco Wal-Mart de México Adelante Rendering banking services through 119 bank branches.

As of november 2009 and december 2008 k) Description of Main Assets

As of September 30, 2009, Company assets are represented mainly by cash ($13.5 billion pesos), goods for sale inventories ($20.7 billion pesos) and fixed assets represented by real estate, stores, restaurants, distribution centers, fixtures and equipment ($82.4 billion pesos). We must point out that cash represents 11.2% of assets, and is wisely and carefully invested following highly conservative standards, and always based on security, liquidity, and yield criteria established by the Finance Committee, in that order of importance.

Some of the units are owned and others are leased.


Fixed assets are formed by business units, as described:

Description by Business FormatFormat Description Units Sales area (sq ft)

Bodega Aurrerá Austere discount stores 610 16,273,229Walmart Supercenters 168 14,678,375Sam's Club Membership warehouse clubs 98 7,841,265Superama Supermarkets 69 1,219,691Suburbia Apparel stores 86 3,839,584

VipsRestaurant chains. This division includes Vips, el Porton, and Ragazzi restaurants.

367 83,810*

Banco Wal-Mart Bank branches 119 N/A* Seats

In addition, the Company has 13 distribution centers with an installed capacity of 18.4 million square feet, as shown in section 4.1.2 (c) Distribution Channels of this report.

l) Growth Plan México is a country offering considerable growth opportunities and it has over 107 million inhabitants, 43% of which are under the age of 21, and 31% under 15 years of age3.

Wal-Mart de México multiple format operation enables us to serve practically all income levels in our country and meet their different buying needs, either for use at home or outside the home. Going one step further, we have developed different prototypes within the existing formats, thus allowing us to efficiently serve different types of communities. As of November 30, 2009, 371 cities have been identified with potential for one or several units of any of the business formats. 115 of them still have no presence.

The Company will continue investing in growth and productivity. Growth plan for 2009 considers the opening of 270 operating units, 18 more than originally announced at the beginning of the year. The increase in installed capacity is estimated at 10%, with an investment of over $11.8 billion pesos.

Based on the foregoing, we developed a prototype for a smaller store “Bodega Aurrerá Express”. This new prototype combines the concept of a discount store with that of a convenience store. The target market is D and E income levels. It will offer the most sought after items from Groceries, Fresh and Consumables at Bodega Aurrerá prices.

3 Source: National Population Council (CONAPO) – Population Forecast in México 2000-2050


m) Litigation, Administrative Actions or Arbitration As of the date of this Prospectus, there are no legally litigation or affair that could affect substantially the operation of the Company.

n) Representative Shares of Capital Stock Wal-Mart de México stock is listed in the Mexican Stock Exchange under the Ticker Symbol WALMEX.

Stock StructureAs of December 31, 2008

Million of sharesSerie Number of shares %

"V" Free subscription common shares 8,435 100 The Company has an ADR-sponsored program on its “V” Series shares. The depositary bank is The Bank of New York.

Stock Performance in the Stock Market 4

Relevant Stock Indicators2009* 2008 2007 2006 2005

Maximum Price 54.51 47.38 49.36 47.56 31.18

Minimum Price 27.63 28.55 34.31 26.23 18.92

Closing Price 52.98 37.00 37.69 47.56 29.51

Volume (millions) 2,352 3,047 3,224 2,213 2,424* As of November 30

Relevant Stock Indicators 2008

Quarter

1st 2nd 3rd 4th

Maximum Price 45.06 47.38 41.50 37.54

Minimum Price 34.90 40.30 35.98 28.55

Closing Price 45.06 40.88 37.61 37.00

Volume (millions) 881 655 622 889 Relevant Stock Indicators 2009

Quarter

1st 2nd 3rd 4th*

Maximum Price 37.97 40.23 49.60 54.51

Minimum Price 27.63 33.88 37.94 45.59

Closing Price 33.07 38.96 46.94 52.98

Volume (millions) 868 614 503 367* As of November 30

4 For comparison reason, values presented were adjusted by the split on February 9, 2006


o) Dividends During recent years, the Company decreed dividend payments in stock or in cash, to be decided by each shareholder. As a result of earning obtained in 2008, dividend payment was granted $5.0 billion pesos paid in cash in 2009.

Dividend PaymentsDecided by each shareholder

Cash In stock(1 for each)

2009 0.61 --

2008 0.59 77.12

2007 0.51 89.37

2006 0.38 80.05 The Company intends to continue paying yearly dividends, the amount of which will depend upon growth opportunities, the economic situation, and the competitive environment, among other factors.

The shares issued as a result of the acquisition of the Wal-Mart Centroamérica operations shall not be subject to dividend payments for results achieved in 2009, if the case.

4.1.3. Evolution and Recent Events WALMEX total sales for the first nine months of the year totaled $189.4 billion pesos, that is, $17.8 billion pesos more than in the same period last year, which represented a 10.4% increase in total units, and a 3.2% increase in comp units. Continuous efforts to translate price efficiencies into lower prices meant a 13.4% increase in the number of served customers.

Gross margin was 21.5%, which is the same percentage than last year. In monetary terms, gross income grew by 10%.

Wal-Mart de México continues its tight expense control and is seeking increased operative efficiencies. Operating expenses grew 8%, 220 basis points below sales growth. In view of the foregoing, operating income grew 14% representing 7.9% of the Company’s income, 30 basis points above the same period last year.

EBITDA grew 14%, thus representing 9.7% of the Company’s income.

Consolidated net income totaled $11.1 billion pesos, that is, 14% above the same period last year.

The 2009 expansion program will be more aggressive than originally planned. Some 270 units will open, or 18 more than announced in the beginning of the year. During the first nine months of the year 127 units were opened: 15 Bodegas Aurrerá, 17 Mi Bodegas Aurrerá, 77 Bodegas Aurrerá Express, 9 Walmarts, 6


Sam’s Clubs, 2 Superamas and 1 Suburbia store. With these openings, the Company now has operations in 21 new cities where it didn’t have presence in the past. Wal-Mart de México now has 1,329 units in 245 cities nationwide.

As of September 30, 2009, Wal-Mart de México has a sound financial position: cash position amounted to $13.5 billion pesos, $6.1 billion pesos more than the same period last year, although during the first nine months of the year Wal-Mart de México invested $6.1 billion pesos in fixed assets, $1.6 billion pesos in the repurchase of 41 million shares, and paid a dividend of $5.0 billion pesos. The balance has no interest-bearing debt.

4.1.4. Structure of Capital At September 30, 2009, paid capital stock for Wal-Mart de México is as follows:

Serie Nominal value Coupon Capital Stock$ Fixed Portion Variable Portion Freely subscribed Fixed Variable

V None value 48 1,075,006,074 7,318,671,149 8,393,677,223 1,844,173 12,555,179Total 1,075,006,074 7,318,671,149 8,393,677,223 1,844,173 12,555,179

Number of shares

Capital Stock

At September 30, 2009, share last price Series “V” was of 46.94 (forty six pesos 94/100).

4.1.5. Significant changes to Issuer’s Financial Statements since the last Annual Report

From the date of Wal-Mart de México Annual Report to the date of the prospectus herein, there have been no significant changes to accounting policies, critical accounting estimates, and provisions. Thus the information as of September 30, 2009, and for the nine months ending on September 30, 2009, is consistent with the information included in the Annual Report.

4.2. Wal-Mart Centroamérica

4.2.1. Name of the Company WM Maya, S. de R.L. de C.V., shall own 100% of TFB Corporation, N.V.

4.2.2. Business Description Wal-Mart Centroamérica is the leading retailer in the region. By November 30, 2009, it has 519 units in operation –including discount stores, warehouse, supermarkets, hypermarkets, and clubs- distributed throughout 5 countries: Guatemala, Honduras, El Salvador, Nicaragua and Costa Rica. Almost 30,000 associates work in the region.


The results posted for Wal-Mart Centroamérica in 2008 were the highest in its history:

Financial Data(US GAAP)

Million of dollars Growth

Year Ended December 31 2008 2007 %

Results

Net sales 3,347 2,882 16.1

Other income 26 22 18.2

Total revenues 3,373 2,904 16.2

Gross profit 812 702 15.7

General Expenses 622 540 15.2

Operating income 190 162 17.3

EBITDA 243 207 17.4

Income before income tax 182 154 18.2

Income tax 58 49 18.4

Net income 121 101 19.8

FINANCIAL POSITION

Cash 139 157 (11.5)

Inventories 263 252 4.4

Other assets 159 126 26.2

Fixed assets 514 479 7.3

Total assets 1,075 1,014 6.0

Suppliers 358 391 (8.4)

Other liabilities 270 245 10.2

Shareholders’ equity 447 378 18.3

Total liabilities and shareholders’ equity 1,075 1,014 6.0

Wal-Mart Centroamérica

Throughout the region, Wal-Mart Centroamérica serves the communities where it is present, through five different formats. In other words, there are five distinct concepts that were devised to meet the differing needs of its customers, under the principle of “the best quality, at the lowest possible prices”.

a) Multiple Format Operation

Supermarkets that focus on customer service in large urban centers, or the surrounding areas.

92 units Presence in: Guatemala and Honduras



Hypermarkets that operate under the premise of one-stop shopping. Located in the periphery of, or main entrances to large cities throughout Central America. The product offering includes a wide assortment in products and brands, in addition to supplementary services such as gas stations, vision centers, bank branches, etc.

16 units Presence in: Guatemala, El Salvador, and Honduras

Discount stores that offer limted assortment at very low prices. Located within or near pedestrian markets, in urban and/or rural areas, as well as suburban communities.

377 units Presence in: Guatemala, El Salvador and Honduras

Warehouse type stores, they are a different style of discount stores, larger in size and with a wider assortment, at equally competitive prices. They are located in urban areas and have successfully opened –with considerable acceptance from their customer base- new units in shopping centers in the countryside of the Central American countries where they operate.

32 units Presence in: Guatemala, Honduras and Costa Rica

Warehouse membership clubs, where members can purchase large volumes in instructional-size packages. They are located close to the entryways of the capital city.

2 units Presence in: Guatemala

b) Distribution Channels Wal-Mart Centroamérica operates 11 Distribution Centers to better serve all units located throughout the five countries of the region:

Honduras 3 Guatemala 3 El Salvador 2 Costa Rica 2 Nicaragua 1 TOTAL 11

The introduction of the cross-dock system is currently underway, so as to increase the speed of product delivery, at lower costs.


The distribution channel has a high performance team of 2,000 associates and quality equipment.

Moreover, there are opportunities for greater centralization regarding general merchandise, textiles, and certain food categories.

c) The Agroindustrial Division Wal-Mart Centroamérica has an Agroindustrial Division consisting of a portfolio of companies specializing in supplying, processing and distributing fresh products, and developing private label grocery and consumer items.

Their mission is to be “a competitive advantage for Wal-Mart Centroamérica, allowing our customers to save money and live better.”

The role of agroindustrial development is to:

– Act regionally, taking into account interaction among the markets – Ensure a unique competitive advantage for the retail operation – Strike a balance between supply and prices throughout the region – Optimize regional and international supply – Standardize product processing through centralization – Maintain positive relations with governments and different associations – Quality assurance and environmental protection

Wal-Mart Centroamérica enjoys different benefits by operating with this division:

– Competitiveness with important competitors for each format – Organization dedicated to retail operations – Freshness guarantee – Daily distribution and high fill-rate – Elimination of processes at store level – Greater capacity for new product development – Quality standards for all food items – Environmental responsibility – Control over supply chain

d) Patents, Permits, Brands and Other Agreements All the banners for the different retail formats (Despensas Familiar, Pali, la Despensa de Don Juan, La Unión, Paiz, Más x Menos, Maxi Bodega, Híper Más, and Híper Paiz and ClubCo), as well as the different private labels (Great Value, Equate, SAM’s Choice, George & Design, SABEMAS, SuperMax, Suli, etc.), are registered trademarks owned by Wal-Mart Stores, Inc., Broadstreet Global

Activities Ltd. Liab. Co., Ahold Retail Services Ag, and different subsidiaries of TFB Corporation N.V., that operates throughout Central America.

The legal use and conservation of rights to the different private labels are of paramount importance to the issuer as they constitute part of the net worth, in addition to the fact that the consumer public identifies with the quality of products sold under the brands, together with the services rendered by the operating companies, thus involving the prestige of said issuer.

Included among the distinct banners of the Group are the various brands owned by the subsidiaries of the Agroindustrial Division, an operation that was created with the purpose of supporting the Wal-Mart Centroamérica retail operations, through the supply, distribution and sale of fresh products and, separately, the development of private label grocery and consumer products.

e) Primary Customers The primary consumer for Wal-Mart Centroamérica is the general public, serving some 312 million customers annually throughout Guatemala, Honduras, El Salvador, Nicaragua, and Costa Rica.

These countries represent a population of over 38 million inhabitants and a retail market of $44 billion dollars, each with different demographic characteristics, preferences and income levels. The multiformat strategy of Wal-Mart Centroamérica provides the flexibility needed to efficiently serve the needs of the different population sectors throughout the region.

The Wal-Mart Centroamérica customer is the general public; the majority, however, pertain to “C” level income groups.

Socioeconomic sectors

10% A-B13% C

23% D

54% E

Socioeconomic sectors

10% A-B13% C

23% D

54% E

10% A-B13% C

23% D

54% E


The diversity in demographic characteristics and income levels in each of the countries are best served by the multiformat approach, wherein the needs of all customers are more efficiently met.

Format Target Sector

Discount stores

Mid-low / Low

Supermarkets High / Mid-high

Hypermarkets

Mid-high / Mid-low

Warehouses

Medium / Low

Clubs

Medium / Low

f) Applicable Legislation and Tax System

The operation known as Wal-Mart Centroamérica is consolidated under TFB Corporation, N.V., an indirect subsidiary of Wal-Mart Stores, Inc. (the majority shareholder). TFB Corporation, N.V., was incorporated on September 20, 2005, with the purpose of serving as the holding Company for a number of subsidiaries that operate stores and run agroindustrial operations, and incorporated in Guatemala, Honduras, El Salvador, Nicaragua, and Costa Rica. All companies comply with each and every legal provision under administrative law, to build and operate its different units, in full compliance with the following types of legislation: construction, environmental and ecological, road and urban development, operations, health, the sale of alcoholic beverages, plant health, and signage, both at federal and local levels, pursuant to the different jurisdictions of the differing federal, state, and municipal authorities in the respective countries.

Likewise, there is full compliance with the basic principles of commercial relations between suppliers and established consumers in each of the countries served.



Regarding the tax position of TFB Corporation, N.V. and its operating subsidiaries are subject to each country Fiscal Bylaws and are registered in their Tax ID and in compliance with any and all tax requirements related to the development of their respective businesses operation.

g) Human Resources Wal-Mart Centroamérica culture centers on three basic beliefs: Respect for the Individual, Customer Service, the Pursuit for Excellence, principles which were the source of inspiration for the Company founders and which today are shared throughout the organization at all levels.

At the close of November 30, 2009 the Company operated 519 self-service stores, 11 distribution centers, and 16 production plants. Wal-Mart Centroamérica is one of the primary employers in the region, with almost 30,000 associates currently working.

Many of the executives and managers of the Company began their careers at entry levels, and therefore talent development is clearly one of the strategic priorities for Wal-Mart Centroamérica, a core element of the business. Some 700 new direct jobs are expected to be created by close of 2009, with over 780,000 man-hours invested in training.

Gender Equity

Female 42%

Male 58%

h) Environmental Performance Wal-Mart Centroamérica is committed to being a Company that sustainably manages each aspect of the business –from the products it sells to the energy it saves.

With this in mind, Wal-Mart Centroamérica has a Sustainability Advisory Board, whose purpose is to serve as a consultant for the sustainability program that the organization operates throughout the region.

The objectives for Wal-Mart Centroamérica, as a Company committed to the environment, are quite simple and transparent: reach 100% renewable energy supply, generate zero wastes, and sell products that not only save resources, but that are also environment-friendly. These goals serve as the framework for all actions undertaken by the Company, both throughout the region as well as worldwide. Key accomplishments to date include:


Energy

During 2008 and 2007, the retail operations for Wal-Mart Centroamérica achieved 22,401,976 kw/hour in savings, equivalent to the annual use of electricity for 7,468 Central American families.

Recycling Programs

In 2008, through its recycling program, Wal-Mart Centroamérica was able to prevent the cutting down of over 225,000 trees as well as reducing the purchase of barrels of oil by 16,000 for the region.

Emission Reduction

Also in 2008, Wal-Mart Centroamérica had an emission of 102,654 tons of CO2, equivalent to 102 kg./m2, primarily from the use of electricity (63%) and coolants used (29%). These indicators place the region among all Walmart operations as the lowest emission rates/square meter.

Reduction in the Use of Plastic Bags

In its aim to help the planet, in late 2008 Wal-Mart Centroamérica committed to reducing the volume of plastic bags used by 33% within a five-year period, which is equivalent to 9 billion of plastic bags.

i) Market Information Wal-Mart Centroamérica is a retail chain, which primarily operates self-service units throughout five countries in the region.

The market where it competes is described as follows:

– Supermarkets with over 1,300 square meters of sales floor, with three or more lines of cash registers, developed scanning technology, as well as mini-supermarkets, which are independent self-service units with one or two lines of cash registers, and a maximum of 370 square meters of sales floor. Among them are retail chains such as La Torre (Guatemala), La Colonia (Honduras), Súper Selectos (El Salvador), La Colonia (Nicaragua), Perimercados, Auto Mercados, Súper Compro, Jumbo (Costa Rica), and Price Smart (clubs in Costa Rica, Guatemala, El Salvador, Honduras, and Nicaragua), among others.

– Department and specialty stores such as Carrion, Siman, Cemaco, EPA, Monolit, ACE, Grupo M, Elektra, Curacao, Bullock’s and Pequeño Mundo.

The formal market in the five countries where Wal-Mart Centroamérica operates is estimated at having 6,000 supermarkets and mini-supermarkets, 8,900 pharmacies, 1,000 general merchandise stores and large category killers, and 15,000 small-sized stores. According to estimates, the formal market represents 34% of the total retail market.

The region has a strong informal market that represents 66% of the retail market. This market includes traditional establishments such as municipal markets, flea markets, grocery stores, second-hand clothing, and general merchandise, in addition to a large number of street vendors. Both sectors have considerable market share as they are able to supply communities that, due to mere size, restrict the entry of other establishments.

The investment made by Wal-Mart Centroamérica in growth, systems, logistics and distribution are meant to increase and modernize both installed capacity and distribution, thus resulting in a more efficient operation, reduced costs and ever improving service for its customers.

j) Description of Main Assets At September 30, 2009, Company’s assets are primarily represented by its cash flow ($80.1 million dollars), days-on-hand of merchandise for sale in stores ($240.4 million dollars) and fixed assets represented by property, stores, restaurants, distribution centers, furniture and equipment ($505.9 million dollars, net, including capital leasing). It should be noted that the cash represents 8.1 %.

The Company operates fully owned units as well as leased ones.

The fixed assets are comprised by the business formats, as described below:

Description by Business FormatFormat Description Number of units

Despensa Familiar Discount stores 202

Pali Discount stores 175

Más x Menos Supermarkets 25

La Unión Supermarkets 7

Paiz Supermarkets 35

La Despensa de Don Juan Supermarkets 25

Híper Paiz Supercenters 10

Híper Más Supercenters 6

Maxi Bodega Warehouse 32

ClubCo Clubs 2

Total 519 k) Litigation, Administrative Actions or Arbitrations

As of the date of this Prospectus there is no legally litigation or affair that could affect substantially the operation of the Company.

l) Shares representing Capital Stock TFB Corporation, N.V., 6,000,000 shares, with par value of $1.00 dollar each.



4.2.3. Evolution and Recent Events There are no relevant events to mention.

4.2.4. Capital Structure Wal-Mart Stores, Inc. currently holds 51% of Wal-Mart Centroamérica shares. The remaining 49% belongs to minority shareholders in the region.

After the Transaction, Wal-Mart de México will hold the 100% equity interest in Wal-Mart Centroamérica.

4.2.5. Significant changes to Issuer Financial Statements since the last Annual Report

As of the date of TFB Corporation N.V. audited report at December 31, 2008, to the date of this Prospectus, there have been no significant changes in accounting policies, critical accounting estimates and provisions. As a consequence, interring information at September 30, 2009 and for the 9 months that ended, is consistent with the annual information presented in the audited report.


5. RISK FACTORS The Company has identified the following risk factors which are related to Company’s operations and may have an impact on performance and profitability, thus influencing the price of the representative capital stock of Wal-Mart de México. Also, it should be noted that the operation or the issuing Company may be affected by other risks of which the Company is not aware, or not deemed significant at this moment.

5.1. Risk factors related to Wal-Mart de México Wal-Mart de México is exposed to events that may have a negative impact on the purchasing capacity and/or shopping habits of its consumers. These events may be of an economic, political, or social nature. The most important are:

• Employment and salaries. A positive or negative variance in employment levels and/or salaries in real terms may impact per capita income, thus affecting Company’s sales performance.

• Interest rates, exchange rates, and inflation figures. Historically, Wal-Mart de México has generated cash surplus, which has enabled the Company to increase financial income. An interest rate decrease may result in lower income and affect profit growth. The Company, however, estimates that interest rate decreases have a positive effect in the medium and long-terms as they contribute towards improving purchasing power. On the other hand, exchange rate fluctuations exert pressure on expectations regarding inflation and purchasing power; hence, they may affect Company’s sales negatively. It is important to mention that the Company does not have interest-bearing debt, Mexican or foreign currency, with the exception of real estate and equipment leasing capitalization, pursuant to Mexican Financial Reporting Standards. In compliance with corporate governance regulations, the Company does not trade with financial instruments (derivatives).

• Competition. In the last few years the retail sector has become increasingly competitive. This has forced retailers to search for differentiating factors. Wal-Mart de México believes that volume is not the only differentiator capable of producing competitive advantages, but rather a defined strategy with a long-term vision, which is clearly customer-oriented, together with a significant value proposition. All of the above, plus investments in technology and distribution centers, allows the Company to offer our customers low-cost and efficient products.


5.2. Risk factors associated with the Transaction

5.2.1. Creditor Opposition Pursuant to that stipulated under the LGSM, creditors for merging corporations have the right to legally oppose said transaction, through summary action. The consequences of said opposition may cause the suspension of the transaction until such time when a ruling is handed down that declares the opposition groundless, thus making said ruling final and conclusive and immediately available for execution. The parties to the transaction are unable to guarantee that no supplier will oppose the merger transaction within the legally applicable term.

5.2.2. Transaction Funding There is no risk whatsoever regarding transaction funding as it will be conducted through the issuing of stock and with cash owned by the Company itself.

5.3. Risk Factors Related to Wal-Mart Centroamérica

5.3.1. Economic, Social and Political Conditions in Central America Wal-Mart Centroamérica is exposed to events that could affect the purchasing power and/or shopping habits of its consumers. Said events may be economic, political or social in nature. Many Latin American countries have faced economic, political and social crisis, natural disasters and major weather conditions in the past and these same events could reoccur in the future. It could be affected by several factors, including, among others, the following:

– Significant government interference in local economies; – Economic slowdowns; – High inflation levels; – Wage and price controls; – Changes in economic or tax policies enforced by the government; – Natural disasters and severe climate conditions; – Imposed trade barriers; – Unexpected regulatory changes; and – Overall political, social and economic instability.

Adverse events and conditions in Central America may inhibit demand and create uncertainly in the operations, which in turn could have material impacts on Wal-Mart de México.


5.3.2. Inflation Central America has historically experienced high inflation levels. Elevated inflation rates could undermine the financial atmosphere for the Company and its results. This would produce a direct impact on customer purchasing power, and on the demand for products and services.

6. SELECTED FINANCIAL INFORMATION Wal-Mart de México, S.A.B. de C.V.

BALANCE SHEETAs of December 31, 2008

(Million of mexican pesos)

PRE OPERATION POST OPERATION (PROFORMA)

$ $

AssetsCurrent assets:Cash and cash equivalents 11,350 11,838

Accounts receivable, net 4,488 5,027

Inventories, net 22,808 26,599

Prepaid expenses 531 607

Total current assets 39,177 44,071

Property and equipment, net 79,287 87,034

Other assets - 32,121

Total assets 118,464 163,226

Liabilities and Shareholders' EquityCurrent liabilities:Accounts payable to suppliers 27,005 31,314

Other accounts payable 8,072 9,890

Total current liabilities 35,077 41,204

Long-term debt - 322

Long-term other liabilities 3,526 11,318

Deferred income tax 5,516 5,576

Labor obligations 69 662

Total liabilities 44,188 59,082

Shareholders’ equity

Capital stock 23,591 52,060

Legal reserve 4,421 4,421

Retained earnings 47,535 47,535

Premium on sale of shares 2,275 2,275

Employee stock option plan fund (3,546) (3,546)

Cumulative transalation adjustment - 1,399

Total shareholders’ equity 74,276 104,144

Total liabilities and shareholders' equity 118,464 163,226



STATEMENT OF INCOMEYear ended on December 31, 2008

(Million of mexican pesos)


$ $

Net sales 244,029 281,407

Other income 888 894

Total revenues 244,917 282,301

Cost of sales 191,633 220,246

Gross profit 53,284 62,055

General expenses 33,533 39,845

Operative income 19,751 22,210

Other expenses, net 369 630

Comprehensive financing result (475) (342)

Income before income tax and minority interest 19,857 21,922

Minority interest - 39

Income tax 5,184 5,839

Net income 14,673 16,044

EBITDA 23,887 26,973


Wal-Mart de México, S.A.B. de C.V.BALANCE SHEET

As of September 30, 2009(Million of mexican pesos)

Non-audit figures


$ $

AssetsCurrent assets:

Cash and cash equivalents 13,511 13,169

Accounts receivable, net 3,187 3,706

Inventories, net 20,749 24,185

Prepaid expenses 495 581

Total current assets 37,942 41,641

Property and equipment, net 82,441 89,877

Other assets - 31,325

Total assets 120,383 162,843

Liabilities and Shareholders' Equity

Current liabilities:

Accounts payable to suppliers 24,038 27,418

Other accounts payable 8,866 10,295

Total current liabilities 32,904 37,713

Long-term debt - 286

Long-term other liabilities 3,898 11,575

Deferred income tax 5,252 5,247

Labor obligations 94 670

Total liabilities 42,148 55,491

Shareholders’ equity

Capital stock 23,476 51,945

Legal reserve 4,718 4,718

Retained earnings 51,761 51,761

Premium on sale of shares 2,245 2,245

Employee stock option plan fund (3,965) (3,965)

Cumulative transalation adjustment - 648

Total shareholders’ equity 78,235 107,352

Total liabilities and shareholders' equity 120,383 162,843


Wal-Mart de México, S.A.B. de C.V.STATEMENT OF INCOME

Nine-month period ended on September 30, 2009(Million of mexican pesos)

Non-audit figures


$ $

Net sales 189,393 222,116

Other income 753 758

Total revenues 190,146 222,874

Cost of sales 149,259 174,873

Gross profit 40,887 48,001

General expenses 25,938 31,528

Operative income 14,949 16,473

Other expenses, net 23 185

Comprehensive financing result (449) (339)

Income before income tax and minority interest 15,375 16,627

Minority interest - 13

Income tax 4,305 4,700

Net income 11,070 11,914

EBITDA 18,368 20,495

6.1. Results Comparison analysis of the base and pro forma Financial Statements at December 31, 2008 and September 30, 2009.

Total Revenues

Total revenues would have increased 15.3% and 17.2% as a result of the incorporation of $37.4 billion pesos and $32.7 billion pesos generated by Wal-Mart Centroamérica operations for the year ending on December 31, 2008 and corresponding to the first nine months of 2009.



Operating Income

By incorporating Wal-Mart Centroamérica operating income, the Company’s income would have increased by $22.2 billion pesos and $16.5 billion pesos, for the period ending on December 31, 2008 and the first nine months of 2009. That is, 12.4% and 10.2% over Wal-Mart de México without the acquisition. Furthermore, the percentage of total revenues on operating income of the Company would have been of 7.9% and 7.4%, 20 basis points and 47 basis points below that reported in 2008 and 2009, respectively. The drop is mainly due to greater amount of expenses as a percentage of Wal-Mart Centroamérica sales.

Comprehensive Financing Result

In 2008 and 2009, the reduction results from the incorporation of Wal-Mart Centroamérica financial expenses totaling $133 and $110, respectively, mainly due to interests from bank loans and difference between present value and future value of the contingent payment.

Income before Income Tax and Minority Interest

As a result of incorporating Wal-Mart Centroamérica results, there is an increase in earnings before taxes and minority interest for $2.1 billion pesos and $1.3 billion pesos, respectively, in the proforma profit and loss statement corresponding to December 2008 and September 2009, and showing a 10.4% and 8.1% growth, respectively.

Income Tax

The increase in the income tax by 0.5 percentage points and 0.3 percentage points at December 31, 2008 and September 30, 2009, respectively, is originated by a higher tax rate in Wal-Mart Centroamérica.

Net Income

By incorporating Wal-Mart Centroamérica results, net income in the proforma statements at December 31, 2008 would have been $16.0 billion pesos, increasing 9.3% vs. Wal-Mart de México scenario without the acquisition. Net profit would have recorded a reduction of 0.3 percentage points, to close at 5.7% of total revenues.

At September 30, 2009, net income would have totaled $11.9 billion pesos, 7.6% greater than the base years. As a percentage of total revenues, it would have been placed at 5.3%, 0.5 percentage points under that recorded by the Company in that period.

These reductions are explained by the incorporation of a higher level expense structure belonging to Wal-Mart Centroamérica.


6.2. Financial Situation, Liquidity and Capital Resources Comparison analysis of the base General Balance and proforma at December 31, 2008 and September 30, 2009.

Cash and Cash Equivalents

Includes the cash payment of this Transaction.

Other Assets

The increase in this line item mainly corresponds to the incorporation of goodwill and intangible assets, generated by the Transaction.

Long-Term Other Liabilities

The increase by 221% and 197% as of December 31, 2008 and September 30, 2009, respectively, is originated from the recording of contingent consideration, after achievement of the results in Centroamérica.

Labor Obligations

The increase in this line item corresponds to labor liabilities by Wal-Mart Centroamérica.

Capital Stock

The variation is explained by the issuance of Wal-Mart de México common stock to pay the consideration generated by the Transaction.

Cumulative Translation Adjustment

This adjustment results from recognizing goodwill valued in foreign currency and whose value in pesos varies each period.

7. ANALYSIS OF RESULTS AND FINANCIAL SITUATION PROFORMA The following table, exemplifying in comparison columns amounts with the highest significance for the Transaction, for a better analysis and interpretation of proforma relevant financial information at September 30, 2009.


Selected Financial InformationNine-month period ended on September 30, 2009

(Million of mexican pesos)Non-audit figures

BASE FIGURES PROFORMA ADJUSTMENT PROFORMA FIGURES GROWTH

$ % Sales $ % Sales $ % Sales

Net Sales 189,393 32,723 222,116 17

Total Revenues 190,146 100.0 32,728 100.0 222,874 100.0 17

Gross Profit 40,887 21.5 7,114 21.7 48,001 21.5 17

Operative income 14,949 7.9 1,524 4.7 16,473 7.4 10

Income Before Income Tax 15,375 8.1 1,252 3.8 16,627 7.5 8

Net Income 11,070 5.8 844 2.6 11,914 5.3 8

EBITDA 18,368 9.7 2,127 6.5 20,495 9.2 12

Assets 120,383 42,460 162,843 35

Liabilities 42,148 13,343 55,491 32

Shareholders´Equity 78,235 29,117 107,352 37

Current Assets/Current Liabilities 1.15 0.77 1.10

Total Liabilities / Shareholders´Equity 0.54 0.46 0.52

Earnings Per Share (9-month basis) 1.315 - 1.322



8. PEOPLE IN CHARGE The undersigned hereby declare under affirmation, within the realm of our respective duties, that we so prepared the information relative to the Issuer contained herein, which to the best of our knowledge and belief reasonably reflects Issuer’s situation. Likewise we declare that we know of no relevant information that has been willfully omitted or misstated herein, nor that the Prospectus presented herein contains any information that could mislead the investor public.

Eduardo Solórzano Morales

Executive President and CEO

José Luis Rodríguezmacedo Rivera Rafael Matute Labrador

Senior Vice President, Legal and Regulatory Compliance

Executive Vice President and CFO

THIS PROSPECTUS INCLUDES REPRESENTATIONS, STATEMENTS AND PROJECTIONS OF FUTURE PERFORMANCE THAT DEPEND ON FACTS AND CIRCUMSTANCES NOT CONTROLLED BY WAL-MART DE MÉXICO. THEREFORE, WAL-MART DE MÉXICO CANNOT ENSURE THAT SAID REPRESENTATIONS, STATEMENTS AND PROJECTIONS WILL OCCUR, NOR THE EFFECT THEY MAY HAVE ON THE OPERATION OR FINANCIAL SITUATION.


9. ATTACHMENTS

9.1. Report of Independent Auditors

To the Shareholders of


We have audited the accompanying consol idated balance sheets of Wal-Mart de México, S.A.B. de C.V. and Subsidiaries as of December 31, 2008 and 2007, and the related consol idated statements of income and changes in shareholders’ equity for the years then ended and cash f lows for the year ended December 31, 2008 and statement of changes in f inancial posit ion for the year ended December 31, 2007. These f inancial statements are the responsibi l ity of the Company’s management. Our responsibi l i ty is to express an opinion on these f inancial statements based on our audits.

We conducted our audits in accordance with audit ing standards general ly accepted in México. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the f inancial statements are free of material misstatement and are prepared in conformity with Mexican Financial Report ing Standards. An audit includes examining, on a test basis , evidence support ing the amounts and disclosures in the f inancial statements. An audit also includes assessing the f inancial report ing standards used and signif icant est imates made by management, as well as evaluating the overal l f inancial statement presentation. We bel ieve that our audits provide a reasonable basis for our opinion.

In our opinion, the consol idated financial statements referred to above present fair ly, in al l material respects, the consol idated f inancial posit ion of Wal-Mart de México, S.A.B. de C.V. and Subsidiaries at December 31, 2008 and 2007, and the consol idated results of their operat ions and changes in their shareholders’ equity for the years then ended and consol idated cash f lows for the year ended December 31, 2008 and consol idated changes in f inancial posit ion for the year ended December 31, 2007, in conformity with Mexican Financial Report ing Standards.

As explained in Note 18, the f inancial statements shown in the columns identif ied as proforma, include the effect of the transaction described in the fol lowing paragraph as though it had occurred on December 31, 2007.

On December 5, 2009, Wal-Mart de México, S.A.B. de C.V. entered into an agreement that determined the purchase of the shares of TFB Corporat ion N.V. and subsidiaries through a related party. Through this t ransaction, Wal-Mart , S.A.B. de C.V. shal l acquire the assets and assume the l iabil it ies of TFB Corporation N.V. and subsidiaries and as of the date on which the acquisit ion is effective, it shall carry out business activ it ies in the Central American region.


In conformity with Mexican Financial Report ing Standard B-7, Business Acquisit ions , the total price paid must be assigned to the different tangible and intangible assets and assumed l iabi l it ies, based on their fair value, which must be determined during the vest ing period; that is, during the year immediately subsequent to the acquisit ion. For the purposes of the proforma financial information, the book values of the acquiree had been used. Such values may be subsequently modif ied once the fair values have been determined.

In our opinion, the effect of the subsequent event described above has been quantif ied and included correctly in the proforma consol idated f inancial statements.

Our audit opinion and the accompanying f inancial statements and footnotes have been translated room original Spanish version into Engl ish for convenience purposes only.

Mancera, S.C.

A Member Practice of

Ernst & Young Global

Enrique García

Mexico City, January 30, 2009, except for Note 19 regarding the f inal approval of the f inancial statements, dated February 11, 2009, and Notes 17 and 18 regarding the subsequent event, dated December 5, 2009.

WAL-MART DE MEXICO, S.A.B. DE C.V. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS

(Notes 1, 2, 3, 17 and 18)Thousands of Mexican pesos for 2008 and thousands of Mexican pesos with purchasing power at December 31, 2007 for 2007

Base figures Proforma adjustments Proforma adjustments2008 2007 2008 2007 2008 2007

AssetsCurrent assets:Cash and cash equivalents Ps. 11,349,798 Ps. 8,983,817 Ps. 488,671 Ps. 294,227 Ps. 11,838,469 Ps. 9,278,044 Accounts receivable, net (note 4) 4,487,796 4,700,237 539,683 400,397 5,027,479 5,100,634 Inventories, net 22,807,943 20,883,131 3,790,788 2,746,779 26,598,731 23,629,910 Prepaid expenses 531,933 655,189 74,676 48,109 606,609 703,298 Total current assets 39,177,470 35,222,374 4,893,818 3,489,512 44,071,288 38,711,886 Property and equipment, net (note 5) 79,286,447 71,521,998 7,746,593 5,787,588 87,033,040 77,309,586 Other assets - - 32,121,320 26,149,264 32,121,320 26,149,264

Total assets Ps. 118,463,917 Ps. 106,744,372 Ps. 44,761,731 Ps. 35,426,364 Ps. 163,225,648 Ps. 142,170,736

Liabilities and Shareholders' EquityCurrent liabilities:Accounts payable to suppliers (note 7) Ps. 27,005,122 Ps. 25,380,996 Ps. 4,308,826 Ps. 3,659,416 Ps. 31,313,948 Ps. 29,040,412 Other accounts payable (Notes 7, 8, 10 & 12) 8,071,532 6,854,382 1,818,191 1,393,791 9,889,723 8,248,173

Total current liabilities 35,076,654 32,235,378 6,127,017 5,053,207 41,203,671 37,288,585

Long-term debt - - 322,421 53,052 322,421 53,052 Long-term other liabilities (note 10) 3,526,022 2,822,618 7,791,717 7,534,643 11,317,739 10,357,261 Deferred income tax (note 11) 5,516,357 5,446,048 59,876 129,086 5,576,233 5,575,134 Labor obligations (note 12) 68,690 56,323 593,584 410,662 662,274 466,985

Total liabilities 44,187,723 40,560,367 14,894,615 13,180,650 59,082,338 53,741,017

Shareholders’ equity (note 13):Capital stock 23,590,996 22,105,239 28,468,746 28,468,746 52,059,742 50,573,985 Legal reserve 4,421,048 4,068,913 - - 4,421,048 4,068,913 Retained earnings 47,535,428 53,313,827 - - 47,535,428 53,313,827 Accumulated result of restatement - ( 12,515,273) - - - ( 12,515,273)Cumulative transalation adjustment - - 1,398,370 (6,223,032) 1,398,370 ( 6,223,032)Premium on sale of shares 2,274,854 2,302,669 - - 2,274,854 2,302,669 Employee stock option plan fund ( 3,546,132) ( 3,091,370) - - ( 3,546,132) ( 3,091,370)

Total shareholders’ equity 74,276,194 66,184,005 29,867,116 22,245,714 104,143,310 88,429,719

Total liabilities and shareholders' equity Ps. 118,463,917 Ps. 106,744,372 Ps. 44,761,731 Ps. 35,426,364 Ps. 163,225,648 Ps. 142,170,736

The accompanyning notes are integral part of these financial statements.


WAL-MART DE MEXICO, S.A.B. DE C.V. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF INCOME



Net sales Ps. 244,029,030 Ps. 224,172,613 Ps. 37,377,839 Ps. 31,484,500 Ps. 281,406,869 Ps. 255,657,113 Other income 887,980 803,768 6,355 4,726 894,335 808,494 Total revenues 244,917,010 224,976,381 37,384,194 31,489,226 282,301,204 256,465,607 Cost of sales ( 191,632,968) ( 176,267,005) ( 28,612,676) ( 24,172,244) ( 220,245,644) ( 200,439,249)Gross profit 53,284,042 48,709,376 8,771,518 7,316,982 62,055,560 56,026,358 General expenses ( 33,532,968) ( 30,038,499) ( 6,312,427) ( 5,480,035) ( 39,845,395) ( 35,518,534)Operating income 19,751,074 18,670,877 2,459,091 1,836,947 22,210,165 20,507,824

Other expenses, net ( 368,871) ( 258,891) ( 260,813) ( 129,720) ( 629,684) ( 388,611)Comprehensive financing result (note 14) 474,447 1,495,271 ( 133,565) ( 147,731) 340,882 1,347,540

Income before income tax and minority interest 19,856,650 19,907,257 2,064,713 1,559,496 21,921,363 21,466,753

Minority interest - - ( 39,103) ( 51,144) ( 39,103) ( 51,144)Income tax (note 11) ( 5,183,822) ( 5,678,251) ( 654,364) ( 493,555) ( 5,838,186) ( 6,171,806)

Net income Ps. 14,672,828 Ps. 14,229,006 Ps. 1,371,246 Ps. 1,014,797 Ps. 16,044,074 Ps. 15,243,803

Earnings per share (in Mexican pesos) Ps. 1.732 Ps. 1.666 Ps. 1.770 Ps. 1.669



WAL-MART DE MEXICO, S.A.B. DE C.V. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007(Notes 1, 2, 3, 17 and 18)

Thousands of Mexican pesos for 2008 and thousands of Mexican pesos with purchasing power at December 31, 2007 for 2007

Capital stock Legal reserve Retained earningsAccumulated result

of restatement

Cumulative translation adjustment

Premium on sale of shares

Employee stock option plan fund Total

Balance at December 31, 2006 Ps. 20,367,261 Ps. 3,622,478 Ps. 49,775,672 Ps. (11,770,373) Ps. - Ps. 2,331,940 Ps. (2,594,396) Ps. 61,732,582

( 29,271) ( 496,974) ( 526,245)Increase in legal reserve 446,435 ( 446,435) - Repurchase of shares ( 366,424) ( 5,844,245) ( 6,210,669)Dividends capitalized and paid 2,104,402 ( 4,400,171) ( 2,099) ( 2,297,868)

Proforma adjustment 28,468,746 ( 6,223,032) 22,245,714

Comprehensive income 14,229,006 (742,801) 13,486,205

Balance at December 31, 2007 50,573,985 4,068,913 53,313,827 (12,515,273) ( 6,223,032) 2,302,669 (3,091,370) 88,429,719

-

(12,535,877) 12,535,877 - Movements in employee stock option plan fund ( 27,815) ( 454,762) ( 482,577)Increase in legal reserve 352,135 ( 352,135) - Repurchase of shares ( 208,151) ( 2,661,168) ( 2,869,319)Dividends capitalized and paid 1,693,908 ( 4,902,047) ( 3,208,139)

Proforma adjustment 7,621,402 7,621,402

Comprehensive income 14,672,828 (20,604) 14,652,224

Balance at December 31, 2008 Ps. 52,059,742 Ps. 4,421,048 Ps. 47,535,428 Ps. - Ps. 1,398,370 Ps. 2,274,854 Ps. (3,546,132) Ps. 104,143,310


Reclassification of the accumulated result of restatement to retained earnings

Movements in employee stock option plan fund



WAL-MART DE MEXICO, S.A.B. DE C.V. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS



Operating activitiesIncome before income tax Ps. 19,856,650 Ps. 19,907,257 Ps. 2,064,713 Ps. 1,559,496 Ps. 21,921,363 Ps. 21,466,753Items related to investing activities:

Depreciation 4,136,073 3,727,361 596,055 494,803 4,732,128 4,222,164Loss from retirement of property and equipment

223,631 271,428 - - 223,631 271,428Stock option compensation expense (9,784) 31,534 ( 9,784) 31,534Items related to financing activities: 91,453 35,635 - - 91,453 35,635

Interest payable under capital leases 169,179 148,254 - - 169,179 148,254Gross cash flows 24,476,986 24,089,935 2,650,984 2,085,833 27,127,970 26,175,768

Variances in:Accounts receivable 962,872 (1,017,877) 1,363 ( 40,764) 964,235 (1,058,641)Inventories (1,924,812) (2,923,488) ( 130,646) ( 699,551) (2,055,458) (3,623,039)Prepaid expenses 123,256 (102,603) ( 221,787) ( 2,621) ( 98,531) ( 105,224)Accounts payable to suppliers 1,624,126 (540,193) ( 368,773) 729,807 1,255,353 189,614Other accounts payable 2,036,770 402,469 144,027 198,096 2,180,797 600,565Income tax (6,713,351) (5,087,568) 46,933 58,262 (6,666,418) (5,029,306)Labor obligations 19,420 50,968 16,195 - 35,615 50,968Net cash flows provided by operating activities

20,605,267 14,871,643 2,138,296 2,329,062 22,743,563 17,200,705

Investing activitiesPurchase of property and equipment (11,315,980) (11,097,440) (1,300,117) (1,466,386) (12,616,097) (12,563,826)Proceeds from the sale of property and

equipment 105,045 94,100 4,423 3,921 109,468 98,021Employee stock option plan fund, net (574,030) (561,880) - - ( 574,030) ( 561,880)Net cash flows used in investing activities (11,784,965) (11,565,220) (1,295,694) (1,462,465) (13,080,659) (13,027,685)

Cash surplus to be applied to financing activities8,820,302 3,306,423 842,602 866,597 9,662,904 4,173,020


Financing aDivi 71,866)Loa (98,338)Pro f 17,795)Repur 10,669)Paym

cap 75,935)Net c

dends paid (3,208,139) (2,297,868) ( 337,678) ( 273,998) (3,545,817) (2,5ns and financial activities 87,522 ( 98,338) 87,522orm adjustment - - (1,417,796) (1,417,795) (1,417,796) (1,4

chase of shares (2,869,319) (6,210,669) - - (2,869,319) (6,2ents for property and equipment under

ital leases ( 376,863) ( 355,553) ( 97,764) ( 20,382) (474,627) (3ash flow used in financing activities (6,454,321) (8,864,090) (1,765,716) (1,810,513) (8,220,037) (10,6 )74,603

Net

equi 01,583)Adju

of in 67,814)Cash an

of year ,247,441Cash an ,278,044

The acco

increase (decrease) in cash and cash

valents 2,365,981 (5,557,667) ( 923,114) ( 943,916) 1,442,867 (6,5stment to cash flows for changes in the rate

flation and exchange rate - (1,006,922) ( 300,237) ( 460,892) (300,237) (1,4d cash equivalents at beginning

8,983,817 15,548,406 1,712,022 1,699,035 10,695,839 17d cash equivalents at end of year Ps. 11,349,798 Ps. 8,983,817 Ps. 488,671 Ps. 294,227 Ps. 11,838,469 Ps. 9

mpanyning notes are integral part of these financial statements.

ctivities


WAL-MART DE MEXICO, S.A.B. DE C.V. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AT DECEMBER 31, 2008 AND 2007

Thousands of Mexican pesos for 2008 and thousands of Mexican pesos with purchasing power at December 31, 2007 for 2007, unless otherwise indicated

NOTE 1 - DESCRIPTION OF THE BUSINESS:

Wal-Mart de Mexico, S.A.B. de C.V. (WALMEX or “the Company”) is a Company

incorporated under the laws of Mexico and l isted on the Mexican Stock Exchange.

The principal shareholder of WALMEX is Wal-Mart Stores, Inc., a U.S.

corporation, through Intersalt, S. de R.L. de C.V., a Mexican Company.

WALMEX has a 99.9% equity interest in the fol lowing groups of companies:

Group Line of Business

Nueva Wal-Mart Operation of 442 (313 in 2007) Bodega Aurrerá discount stores, 91 (83 in 2007) Sam’s Club membership self-service wholesale stores, 153 (136 in 2007) Walmart hypermarkets and 67 (64 in 2007) Superama supermarkets.

Suburbia Operation of 84 (76 in 2007) Suburbia stores with apparel and accessories for the entire family.

Vips Operation of 267 (256 in 2007) Vips restaurants serving international cuisine, 93 (92 in 2007) El Portón restaurants serving Mexican food, and 7 restaurants special izing in I tal ian food during both years.

Comercial izadora Mexico Americana Import of goods for sale.

Real estate Real estate developments and management of real estate companies.

Services companies Rendering of professional services to Group companies, not-for-prof i t services to the community at large and shareholding.

Banco Wal-Mart de Mexico Adelante Rendering banking services through 38 (16 in 2007)

customer and member services modules.


On October 1st. 2007, the Mexican National Banking and Securit ies Commission

(CNBV) authorized WALMEX to operate Banco Wal-Mart de Mexico Adelante,

S.A., Inst i tución de Banca Múlt iple (Bank), which opened i ts doors to the general

public on November 7, 2007.

NOTE 2 - NEW FINANCIAL REPORTING STANDARDS:

In 2007, the Mexican Financial Report ing Standards Research and Development

Board (Consejo Mexicano para la Investigación y Desarrol lo de Normas de

Información Financiera, A.C. or CINIF) issued f ive new Mexican Financial

Report ing Standards (Mexican FRS) that came into effect as of January 1st. 2008.

Mexican FRS B-10, Effects of Inf lat ion , establ ishes the condit ions for recognizing

the effects of inf lat ion on f inancial information based on the cumulative rate of

inf lat ion over the last three years.

Cumulative inf lat ion over 2006, 2007 and 2008 is less than 26% and therefore, in

conformity with Mexican FRS B-10, Mexico’s current economic environment is

considered non-inf lat ionary and so the Company’s f inancial information for 2008

was prepared without recognizing the effects of inf lat ion.

The Interpretat ion of Mexican FRS 9 establ ishes that comparative f inancial

statements for years prior to 2008 must be expressed in Mexican pesos with

purchasing power at December 31, 2007, which was the last date on which the

effects of inf lat ion were recognized.

For a more accurate evaluation of the Company’s business performance, the

consol idated statements of income for 2008 and 2007 are presented in the next

page in nominal Mexican pesos for both years.


Year ended December 31

2008

2007

%

Growth

Net sales Ps. 244,029,030 Ps. 219,713,915 11

Other income 887,980 786,826 13

Total revenues 244,917,010 220,500,741 11

Gross profit 53,284,042 47,750,910 12

General expenses ( 33,532,968) ( 29,427,560) 14

Operating income 19,751,074 18,323,350 8

Other expenses, net ( 368,871) ( 255,335) 44

Comprehensive f inancing result 4 7 4 ,447 1,467,945 (68)

Income before income tax 19,856,650 19,535,960 2

Income tax ( 5,183,822) ( 5,574,287) (7)

Net income Ps. 14,672,828 Ps. 13,961,673 5

Mexican FRS B-2, Statement of Cash Flows , establ ishes that the statement of

changes in f inancial posit ion wil l be substi tuted by a statement of cash f lows as

part of the basic f inancial statements. For comparative purposes, the statement of

changes in f inancial posit ion for the year ended at December 31, 2007 was

changed to a statement of cash flows.

As required by Mexican FRS B-2, the Company’s statement of changes in f inancial

posit ion is presented in the next page in thousands of Mexican pesos with

purchasing power at December 31, 2007.


Year ended

December 31, 2007

Net income Ps. 14,229,006

Items not requir ing the use of resources: 3,332,496

17,561,502

Resources used in operating activi t ies ( 4,110,769)

Resources provided by operating activi t ies 13,450,733

Resources used in f inancing activi t ies ( 7,995,327)

Resources used in investing activi t ies (12,019,995)

Net decrease in cash and cash equivalents ( 6,564,589)

Cash and cash equivalents at beginning of year 15,548,406

Cash and cash equivalents at end of year Ps. 8,983,817

The adoption of Mexican FRS B-15, Foreign Currency Translat ion , Mexican FRS

D-3 , Employee Benefits , and Mexican FRS D-4 , Taxes on Profi ts , did not have a

material effect on the Company's f inancial information.

NOTE 3 - SIGNIFICANT ACCOUNTING POLICIES:

The signif icant accounting pol ic ies and practices observed by the Company in the

preparation of the consol idated f inancial statements, in conformity with Mexican

FRS, are described below. Mexican FRS are understood to encompass the new

standards issued by the CINIF and the bul let ins issued by the Accounting

Principles Board of the Mexican Inst i tute of Public Accountants that have not been

modif ied, replaced or abol ished by Mexican FRS and that were transferred to the

CINIF. As such, any of the documents comprising Mexican FRS wil l hereinafter

be referred to by their original name or rather, either as “Mexican FRS” or as

“accounting Bullet in”, as the case may be.


a. The accompanying consol idated f inancial statements include the statements

of WALMEX and those of i ts subsidiaries, which are grouped as described in

Note 1. Al l related party balances and transactions were el iminated in the

consolidation.

b. As required by Mexican FRS B-10, Effects of Inf lat ion , the Company’s 2008

f inancial information is shown in thousands of nominal Mexican pesos

because the cumulative inf lat ion rate over the last three years was 15.01%

and so Mexico’s current economic environment is considered non-inf lat ionary.

The accumulated result of restatement at December 31, 2007 was reclassif ied

to the retained earnings caption in the balance sheet.

c. In order to provide a better understanding of the Company’s business

performance, the consolidated statements of income were prepared on a

functional basis, which al lows for the disclosure of the cost of sales

separately from other costs and expenses and of operating income as well , as

establ ished under Mexican FRS B-3, Statements of Income .

d. The Bank’s f inancial statements, which are included in the Company’s

consol idated f inancial statements, were prepared based on the accounting

cri ter ia establ ished by the CNBV, as issued as part of the General Provisions

for Credit Inst i tut ions, and on the Mexican FRS issued by the CINIF. At date,

there are no dif ferences between these two sets of standards.

e. The preparation of f inancial statements in conformity with Mexican FRS

requires the use of est imates in some items. Actual results might dif fer from

these estimates.

f . Cash and cash equivalents consist basical ly of bank deposits and highly l iquid

investments. Such investments are stated at acquisit ion cost plus accrued

interest, not in excess of market value.

The Company has no transactions with derivative f inancial instruments.


g. The balance of the Bank’s receivables portfol io is represented by amounts

actual ly given to borrowers, plus uncol lected earned interest. The preventive

al lowance for credit r isks is presented net of the portfol io balances.

h. WALMEX recognizes bad debt reserves at the t ime the legal col lect ion

process begins in conformity with i ts internal procedures.

i . Inventories are stated at average cost, determined largely using the retai l

method. Due to the rapid turnover of inventories, the cost so determined is

considered to be similar to replacement cost at the balance sheet date, not in

excess of market value.

The buying al lowances are charged to operations based on the turnover of

inventories that gave r ise to them.

j . Property and equipment are recorded init ial ly at acquisit ion cost.

Fixed asset depreciat ion is computed using the straight- l ine method, at annual

rates ranging from 3% to 33%.

k. The Company classif ies i ts operating and capital leases for the rental of

property fol lowing the guidel ines established in accounting Bullet in D-5,

Leases .

l . In conformity with accounting Bullet in C-15, the Company determines

impairment in the value of i ts long-l ived assets using the present value

method, considering each of the Company's stores or restaurants as a

minimum cash generating unit to determine the value in use of i ts long-l ived

assets.

m. Foreign currency denominated monetary assets and l iabi l i t ies are translated

to Mexican pesos at the prevai l ing exchange rate as of the balance sheet

date. Exchange dif ferences determined are charged or credited to income, as

required by Mexican FRS B-15 , Foreign Currency Translat ion .


n. Liabi l i t ies for tradit ional deposits of the Bank are comprised of demand

deposits in debit card accounts. These l iabi l i t ies are recorded at either

deposit or placement cost, plus accrued interest.

o. Liabi l i ty provisions are recognized whenever the Company has current

obl igations derived from past events that can be reasonably estimated and

that wi l l most l ikely give r ise to a future cash disbursement for their

sett lement.

p. Deferred income tax is determined using the asset and l iabi l i ty method.

Under this method, deferred income tax is recognized on all temporary

dif ferences in balance sheet accounts for f inancial and tax report ing

purposes, using the enacted income tax rate that wil l be in effect at the t ime

the temporary dif ferences giving r ise to deferred tax assets and l iabi l i t ies are

expected to be recovered or sett led, in conformity with Mexican FRS D-4,

Taxes on Profi ts .

Deferred tax assets are evaluated periodical ly in order to determine their

recoverabil i ty.

q. Seniori ty premiums accruing to employees under the Mexican Labor Law and

termination payments made at the end of employment, except when result ing

from corporate restructuring, are recognized as a cost of the years in which

services are rendered, based on actuarial computations made by an

independent expert, using the projected unit-credit method, in conformity with

Mexican FRS D-3 , Employee Benefits .

Actuarial gains and losses are amort ized based on the expected remaining

working l i fe of the Company’s employees.

Al l other payments accruing to employees or their beneficiaries in the event of

separation or death, in terms of the Mexican Labor Law, are expensed as

incurred.


In conformity with Mexican FRS D-3, employee prof i t sharing is recognized in

the Other expenses, net caption and represents a l iabi l i ty due and payable in

less than one year.

r. In conformity with the Mexican Corporations Act, the Company is required to

appropriate at least 5% of the net income of each year to increase the legal

reserve. This practice must be continued unti l the legal reserve reaches 20%

of capital stock.

s. The employee stock option plan fund is comprised of WALMEX shares

presented at acquisit ion cost. The plan is designed to grant stock options to

executives of the companies in the Group, as approved by the CNBV.

t. The premium on the sale of shares represents the dif ference between the cost

of the shares, restated through December 31, 2007 based on the Mexican

National Consumer Price Index (NCPI), and the value at which such shares

were assigned to executives of companies in the Group, net of the

corresponding income tax.

u. Comprehensive income consists of the current year net income plus the

current year restatement.

v. Sales revenues are recognized at the t ime the customer takes ownership of

the products, in conformity with International Accounting Standard No. 18,

issued by the International Accounting Standards Committee, appl ied on a

supplementary basis.

Sam’s Club membership revenues are deferred over the twelve-month term of

the membership, in conformity with the requirements of Staff Accounting

Bullet in No. 104, Revenue Recognit ion in Financial Statements , issued by the

U.S. Securit ies and Exchange Commission, appl ied on a supplementary basis.

Such revenues are presented in the other income caption in the statement of

income.


The Bank’s interest income is recognized in the Other Income caption in the

statement of income.

w. The Company determined earnings per share by dividing the net income by

the average weighted number of shares outstanding.

x. Segment f inancial information has been prepared using the management

approach establ ished in accounting Bullet in B-5, which is based on the

information used by Company management to make business decisions and

monitor the Company’s performance.


NOTE 4 - ACCOUNTS RECEIVABLE, NET:

An analysis of accounts receivable is as fol lows:

December 31

2008 2007

Recoverable taxes Ps. 2,374,815 Ps. 1,905,647

Trade receivables 1,860,273 2,754,901

Other accounts receivable 324,477 284,021

Allowance for bad debts ( 71,769) ( 244,332)

Total Ps. 4,487,796 Ps. 4,700,237


NOTE 5 - PROPERTY AND EQUIPMENT, NET:

An analysis of property and equipment is as fol lows:

December 31

2008 2007

Investments subject to depreciat ion:

Bui ld ings Ps. 27,999,265 Ps. 25,426,052

Faci l i t ies and leasehold improvements 21,035,129 17,999,691

49,034,394 43,425,743

Less:

Accumulated depreciat ion (13,424,189) ( 11,864,717)

Property, net 35,610,205 31,561,026

Fixtures and equipment 27,930,767 25,165,660

Less:

Accumulated depreciat ion ( 13,691,512) ( 12,197,804)

Fixtures and equipment, net 14,239,255 12,967,856

Capital lease:

Property 4,369,203 3,427,307

Fixtures and equipment 855,073 992,735

5,224,276 4,420,042

Less:

Accumulated depreciat ion ( 1,210,417) ( 1,128,301)

Capital lease, net 4,013,859 3,291,741

Investments subject to depreciat ion, net Ps. 53,863,319 Ps. 47,820,623


December 31

2008 2007

Investments not subject to depreciat ion:

Land Ps. 22,750,274 Ps. 21,961,456

Construction in progress 2,672,854 1,739,919

Investments not subject to depreciat ion. Ps. 25,423,128 Ps. 23,701,375

Total Ps. 79,286,447 Ps. 71,521,998

NOTE 6 - FOREIGN CURRENCY DENOMINATED ASSETS AND LIABILITIES:

An analysis of the balances in foreign currency is as fol lows:

December 31

2008 2007

Thousands of U.S. dol lars

Current assets $ 36,934 $ 111,962

Current l iabi l i t ies $ 176,211 $ 208,733

The Company had the fol lowing U.S. dol lar denominated transactions (excluding

property and equipment):

December 31

2008 2007

Thousands of U.S. dol lars

Imported merchandise for sale

$ 1,043,656

$ 1,148,411

Technical assistance, services and royalt ies

$ 125,582

$ 117,264


The exchange rate at December 31, 2008 used to translate U.S. dol lars

denominated balances was Ps. 13.6944 (Ps. 10.9088 at December 31, 2007)

pesos per U.S. dol lar. At the date of these financial statements, the exchange rate

was Ps. 14.1783 pesos per U.S. dol lar.

NOTE 7 - RELATED PARTY BALANCES AND TRANSACTIONS:

Accounts payable to suppliers and other accounts payable include the fol lowing

balances due to related part ies:

December 31

2008 2007

Accounts payable to suppliers:

C.M.A. – U.S.A., L.L.C. (aff i l iated Company) Ps. 715,474 Ps. 784,902

Global George, L.T.D. (aff i l iated Company) 5,290 -

Ps. 720,764 Ps. 784,902

Other accounts payable:

Wal-Mart Stores, Inc. (holding Company) Ps. 352,223 Ps. 312,458

The Company carr ied out the fol lowing transactions with related part ies under

similar-to-market condit ions:

December 31

2008 2007

Imported merchandise for sale Ps. 3,930,879 Ps. 4,812,824

Technical assistance, services and royalt ies Ps. 1,350,920 Ps. 1,226,543


During the year ended December 31, 2008, the Company paid i ts primary off icers

compensations aggregating Ps. 418,185 (Ps. 406,690 in 2007). Such

compensation is pr imari ly comprised of direct short-term benefits as defined in

Mexican FRS D-3.

NOTE 8 - OTHER ACCOUNTS PAYABLE:

An analys is of other accounts payable is as fo l lows:

December 31

2008 2007

Accrued l iabi l i t ies and others Ps. 7,364,774 Ps. 5,362,633

Labor obl igations 74,728 67,675

Taxes payable 632,030 1,424,074

Total Ps. 8,071,532 Ps. 6,854,382

NOTE 9 – COMMITMENTS:

At December 31, 2008, the Company has entered into commitments for the

purchase of inventory, property and equipment and maintenance services for Ps.

4,709,435 (Ps. 4,675,188 in 2007).

NOTE 10 – LEASES:

The Company has entered into operat ing leases with th ird part ies for compulsory

terms ranging from 2 to 15 years. Rent paid under capi ta l leases may ei ther be

f ixed or var iable, based on a percentage of sales.

The Company has entered into capital leases for the rental of real estate. Such

leases are recorded at the lesser of either the present value of minimum rental


payments or the market value of the property under lease and are amort ized over

the useful l i fe of each property (up to 33 years).

The Company has also entered into capital leases for the rental of residual water

treatment plants used to meet environmental protection standards. The term of

payment ranges from 4.25 to 10 years.

Future rental payments are as follows:

Operating Capital

Lease Lease

Year (Compulsory term) (Minimum payments)

2009 Ps. 174,849 Ps. 222,720

2010 Ps. 150,554 Ps. 210,298

2011 Ps. 141,792 Ps. 216,801

2012 Ps. 134,959 Ps. 227,009

2013 Ps. 134,566 Ps. 206,893

2014 and thereafter Ps. 480,840 Ps. 2,665,021

Total rent under operating leases charged to results of operations for the years

ended December 31, 2008 and 2007 was Ps. 1,801,929 and Ps. 1,593,026,

respectively.

NOTE 11 – INCOME TAX:

The Company and i ts subsidiaries, except for the Bank, have been authorized by

the Ministry of Finance and Public Credit to determine their tax results on a

consolidated basis.

An analysis of taxes charged to results of operations of the years ended

December 31, 2008 and 2007 is as fol lows:


December 31

2008 2007

Current year income tax Ps. 5,365,353 Ps. 6,140,437

Deferred income tax ( 181,531) ( 498,394)

Subtotal 5,183,822 5,642,043

Monetary posit ion (gain) on init ial effect and non-monetary i tems loss of deferred income tax, net

-

36,208

Total Ps. 5,183,822 Ps. 5,678,251

An analysis of the deferred tax l iabi l i t ies (assets) derived from temporary

dif ferences is as fol lows:

December 31

2008 2007

Property and equipment Ps. 5,889,508 Ps. 5,183,075

Inventories 636,300 1,286,101

Recoverable asset tax - ( 323,898)

Unamortized tax loss for the Bank ( 230,042) ( 64,733)

Other i tems, net ( 779,409) ( 634,497)

Total Ps. 5,516,357 Ps. 5,446,048

The effect ive tax rate of WALMEX is lower than the 28% corporate income tax rate

establ ished in the Income Tax Law, since the effects of inf lat ion on monetary and

non-monetary i tems are no longer recognized in accounting as of January 1, 2008.

The lower effect ive tax rate is also due to the Company’s enjoying the tax benefi t

for the correct and t imely f i l ing of income tax prepayments offered by the tax

authority under Section X, Art icle 16 of the Federal Revenues Act for 2007.


On October 1, 2007, the new Flat-Rate Business Tax (IETU) Law was published in

the Official Gazette , which came into force on January 1, 2008, and abrogated

the Asset Tax Law.

Based on i ts forecast, the Company wil l continue generating income tax in

subsequent years.

The Company’s 2008 income tax includes the part ial taxation of the inventory held

at December 31, 2004, since the Company opted to consider such inventories as

taxable over a number of years, for purposes of deducting cost of sales. The last

year of taxation of the inventories wil l be 2012.

The Bank has tax losses from prior years which, in conformity with the current

Mexican Income Tax Law, may be carr ied forward against taxable income

generated in the next ten years. An analysis of the avai lable tax loss carryforward

at December 31, 2008 is as fol lows:

Year of expirat ion

Amount

2016 Ps. 23,291

2017 232,545

2018 565,743

Ps. 821,579

As a result of changes in Mexican Tax Law, the Company's recoverable asset tax

at December 31, 2008 may be recovered through 2017.


NOTE 12 – LABOR OBLIGATIONS:

The Company has set up a defined benefi ts trust fund to cover seniori ty premiums

accruing to employees. Workers make no contr ibutions to this fund. The Company

also recognizes the l iabi l i ty for employee termination payments. Both these

obl igations are computed using the projected unit credit method.

The Company’s assets, l iabi l i t ies and costs related to seniority premiums and

employee termination payments for reasons other than corporate restructuring are

as fol lows:

Seniori ty premiums Employee termination payments

2008 2007 2008 2007

Vested benefi t obl igation Ps. 155,538 Ps. 174,871 Ps. 59,211 Ps. 96,677

Defined benefi t obl igation Ps. 382,977 Ps. 347,421

Ps. 108,543 Ps. 99,378

Plan assets ( 367,145) (319,792) - -

Unamort ized i tems 11,438 ( 3,009) 7,605 -

Net projected l iabi l i ty Ps. 27,270 Ps. 24,620 Ps. 116,148 Ps. 99,378

Labor cost for current service Ps. 57,124 Ps. 46,375

Ps. 8,679 Ps. 7,040

Financial cost 28,337 13,405 8,338 3,842

Return on plan assets ( 25,989) ( 12,510) - -

Actuarial loss (gain) 3,952 144 ( 408) 41,689

Net period cost Ps. 63,424 Ps. 47,414 Ps. 16,609 Ps. 52,571


Benefi ts paid from the trust for seniori ty premiums for the year ended December

31, 2008 aggregated Ps. 25,040 (Ps. 18,365 in 2007), while contr ibutions made to

the trust during the year aggregated Ps. 60,761 (Ps. 49,017 in 2007).

At December 31, 2008, the plan assets have been invested through the trust as

fol lows: 83% in the money market, 14% in the capital market and 3% in mutual

funds.

At December 31, 2008 the nominal discount rate used to calculate the present

value of labor obl igations is 9.25% (4.75% real rate in 2007). The nominal salary

increase rate is 5.0% (1.0% real rate in 2007) and the nominal return rate for the

plan assets was 9.25% (4.75% real rate in 2007).

At December 31, 2008, the current other accounts payable caption includes the

balance of labor obl igations for seniori ty premiums of Ps. 14,755 (Ps. 13,604 in

2007) and employee termination payment for reasons other than corporate

restructuring of Ps. 59,973 (Ps. 54,071 in 2007).


The fol lowing is an analysis at December 31 of the Company’s assets and

l iabi l i t ies that make up i ts labor obl igations related to seniority premiums and

employee termination payments for reasons other than corporate restructuring:

Seniority premiums

Employee termination payments

Year

Defined benefit

obligation

Plan assets

Plan status Unamortized

items

Defined benefit

obligation Unamortize

d items

2008 Ps. 382,977 Ps.(367,145) Ps. 15,832 Ps. 11,438 Ps.108,543 Ps. 7,605

2007 Ps. 347,421 Ps.(319,792) Ps. 27,629 Ps.( 3,009) Ps. 99,378 -

20061 Ps. 298,380 Ps.(279,399) Ps. 18,981 Ps. 6,349 Ps. 42,600 -

20051 Ps. 261,673 Ps.(246,614) Ps. 15,059 Ps. 11,336 - -

20041 Ps. 222,040 Ps.(212,998) Ps. 9,042 Ps. 18,671 - -

The Company computed deferred employee profi t sharing for the years ended

December 31, 2008 and 2007 using the asset and l iabil i ty method, as required by

Mexican FRS D-3. The result of the computation is that the Company had no

deferred employee profi t sharing in such years.

( 1 ) Figures in thousands of Mexican pesos with purchasing power at December 31,

2007


NOTE 13 – SHAREHOLDERS’ EQUITY:

a. The resolut ions adopted and amounts approved at general shareholders’

meetings held on March 12, 2008 and March 6, 2007 are as fol lows:

Agreements 2008 2007

1. Approval of the maximum amount the Company wil l use to repurchase its own shares (nominal)

Ps.8,000,000

Ps.8,000,000

2. Cancellat ion of Series “V” shares result ing from the repurchase of shares 152,018,400

158,368,900

3. Increase in the legal reserve, charged to retained earnings (nominal) Ps. 352,135

Ps. 434,632

4. A declared dividend, for which shareholders may receive payment either in cash or in Company shares at an exchange factor determined based on both the closing market price of the Company's shares on Apri l 2, 2008 (March 28, 2008) and the cash dividend (nominal peso)

Date of dividend payment

Ps.0.59

Apri l 18

Ps.0.51

Apri l 20

5. Increase in the variable port ion of capital stock (nominal) for up to:

The above capital increase wil l be covered by issuing common ordinary shares to be used solely for payment of the stock dividend. Maximum number of shares to be issued:

Ps.4,991,590

178,271,066

Ps.4,369,383

109,234,586

Those shares that are not subscribed and del ivered to the shareholders shal l

be cancelled and the proposed capital increase shal l be reduced

proport ional ly.


The shareholders' deadline for deciding on whether to accept the cash

dividend or the stock dividend expired on Apri l 15, 2008 (Apri l 17, 2007). An

analysis of this caption is in the next page.

2008 2007

Number of shares Series “V” del ivered to shareholders

37,228,737

44,921,618

Amount of the shares del ivered to shareholders (nominal)

Ps.1,693,908

Ps. 2,047,527

Number of cancel led shares 141,042,329 64,312,968

Decrease in capital stock due to the cancellat ion of unsubscribed shares (nominal)

Ps.3,297,682

Ps. 2,321,856

Based on the preceding paragraph and as required by Art icle 112 of the

Mexican Corporations Act that establ ishes that al l of an enti ty’s shares must

have the same theoretical value, the Company recomputed i ts capital stock by

determining a f ixed minimum amount of Ps. 1,844,173 for 2008 and Ps.

1,631,224 for 2007 (nominal).

b. The Company’s capital stock is comprised of unl imited registered shares with

no par value.

At December 31, unrestated capital and the number of shares are as fol lows:

Capital stock 2008 2007 -

Fixed Ps. 1,844,173 Ps. 1,631,224 Variable 12,625,520 11,270,607

Total Ps. 1 4 ,469,693 Ps. 12,901,831


Number of freely subscribed 2008 2007 . common series “V” shares

Fixed (Class 1) 1,075,006,074 1,071,307,452

Variable (Class 2) 7,359,674,349 7,401,977,734

Total 8,434,680,423 8,473,285,186

Capital stock at December 31, 2008 and 2007 includes capital ized earnings of

Ps. 11,451,328 and Ps. 9,757,420 (nominal), respectively, and Ps. 899,636

(nominal) in both years in capital ized restatement accounts.

During the year ended December 31, 2008, WALMEX repurchased 75,833,500

(144,005,000 in 2007) of i ts own shares, of which 12,963,400 (4,950,000 in

2007) were cancel led as per the resolut ion adopted at the shareholders’

meeting held on March 12, 2008 (March 6, 2007). As a result of the share

repurchases, historical capital stock was reduced by Ps. 126,046 (Ps. 210,884

in 2007). The dif ference between the theoretical restated value and the

repurchase cost of the shares acquired was appl ied against retained earnings.

c. Distr ibuted earnings and capital reductions in excess of the balance of the net

tax profi t account (CUFIN) and the restated contr ibuted capital account

(CUCA) wil l be subject to taxation in terms of Art icles 11 and 89 of the

Mexican Income Tax Law.

At December 31, 2008 and 2007, the total balance of the aforesaid tax

accounts is Ps. 66,246,839 and Ps. 58,822,330, respectively.

d. The employee stock option plan fund consists of 136,131,446 WALMEX

shares, of which 127,564,266 shares have been placed in a trust created for

such purpose. Al l employee stock options are granted to executives of

subsidiary companies at a value that is no less than the market value on the

date of grant.

In accordance with current pol ic ies, WALMEX executives may exercise their

option to acquire the shares in equal parts over f ive years. The r ight to


exercise an employee stock option expires in a period of ten years from the

date the option is granted, or within sixty days fol lowing the executive’s

ret irement from the Company.

Compensation from stock options is determined using the Black-Scholes

f inancial valuation technique, in conformity with the guidel ines of International

Financial Report ing Standard 2, issued by the International Accounting

Standards Board, appl ied on a supplementary basis. The amount charged to

results of operations for this i tem aggregates Ps. 91,453 in 2008 and Ps.

35,635 in 2007, which represents no cash disbursement.

An analysis of movements in the Company's employee stock option plan is as

fol lows:

Number of shares

Weighted average price

per share (nominal pesos)

Balance at December 31, 2006 125,264,275 17.96

Granted 19,490,736 43.09

Exercised ( 14,765,841) 15.26

Cancelled ( 5,831,632) 22.86


Granted 25,402,584 38.70

Exercised ( 13,113,293) 17.19

Cancelled ( 3,050,172) 35.51


Shares avai lable for option grant:

December 31, 2008 2,734,789 December 31, 2007 5,387,201

At December 31, 2008, the employee stock options granted and exercisable

and included in the employee stock option plan fund were as shown in the

next page.


Granted Exercisable

Range of exercise price

(nominal pesos)

Number of shares

Average remaining

l i fe ( in years)

Weighted average price per

share (nominal pesos)

Number of shares

Weighted average price per

share (nominal pesos)

9.96 – 11.41 8,567,180 2.0 11.12 8,567,180 11.12

10.73 – 12.64 9,742,411 3.2 12.54 9,742,411 12.54

11.55 – 13.75 14,970,534 4.2 12.55 14,970,534 12.55

16.90 – 18.18 17,928,613 5.2 16.93 12,752,428 16.94

19.80 20,981,816 6.2 19.80 10,489,090 19.80

28.79 - 30.03 19,089,864 7.2 28.81 5,785,609 28.81

43.09 17,376,487 8.2 43.09 3,625,143 43.09

38.70 24,739,752 9.2 38.70 - -

133,396,657 6.3 25.34 65,932,395 17.47

NOTE 14 – COMPREHENSIVE FINANCING RESULT:

An analysis of comprehensive f inancing result is as fol lows:

December 31

2008 2007

Financial income, net Ps. 783,214 Ps. 817,611

Exchange ( loss) gain, net ( 308,767) 13,375

Monetary posit ion gain - 664,285

Total Ps. 474,447 Ps.1,495,271


NOTE 15 – SEGMENT INFORMATION:

The Company’s segment information was prepared based on a managerial

approach and the cri teria establ ished in accounting Bullet in B-5. The “Other”

segment consists of department stores, restaurants, real estate transactions with

third part ies and f inancial services.

An analysis of segment information at December 31, 2008 and 2007 is as fol lows:

Segment Total revenues Operating income

2008 2007 2008 2007

Self service Ps. 230,312,982 Ps. 209,652,627 Ps. 18,319,562 Ps. 16,257,811

Other 14,604,028 15,323,754 1,431,512 2,413,066

Consolidated Ps. 244,917,010 Ps. 224,976,381 Ps. 19,751,074 Ps. 18,670,877

Segment Purchase of property and

equipment Depreciation

2008 2007 2008 2007


Other 1,362,847 2,641,845 714,854 585,783

Consolidated Ps. 11,315,980 Ps. 11,097,440 Ps 4,136,073 Ps. 3,727,361


Segment Total assets Current l iabi l i t ies

2008 2007 2008 2007


Other 13,996,423 13,623,834 2,256,645 2,066,068

Unassignable i tems 8,736,927 5,233,337 1,296,401 1,885,436

Consolidated Ps. 118,463,917 Ps. 106,744,372 Ps. 35,076,654 Ps. 32,235,378

Unassignable i tems refer primari ly to reserve land, cash and cash equivalents of

the parent and real estate companies, as well as income tax payable.

The Company operates in Mexico and makes sales to the general publ ic.

NOTE 16 - NEW ACCOUNTING PRONOUNCEMENTS:

On November 11, 2008, the CNBV issued a press release announcing i ts decision

to require companies l isted on the Mexican Stock Exchange to adopt the

International Financial Report ing Standards (IFRS) issued by the International

Accounting Standards Board (IASB). In conjunction with the CINIF, the CNBV wil l

work on developing an IFRS adoption process for issuers in Mexico and wil l also

make the regulatory changes necessary for this implementation. Such changes

wil l include the requirement that issuers prepare and disclose their f inancial

information based on IFRS as of 2012 and wil l also include the option of early

adoption of IFRS report ing in 2008, 2009, 2010 and 2011. The Company is

evaluating what effect the observance of these standards wil l have on the

Company’s f inancial statements.

On December 19, 2008, the CINIF approved Mexican FRS B-7, Business

Acquisit ions ; Mexican FRS B-8, Consolidated and Combined Financial


Statements; Mexican FRS C-7, Investments in Associated Companies and Other

Permanent Investments; Mexican FRS C-8, Intangible Assets ; and Mexican FRS

D-8 , Share Based Payments , which came into force as of January 1, 2009. The

appl icat ion of these new standards wil l have no material effect on the Company’s

f inancial statements.

NOTE 17 - SUBSEQUENT EVENT:

On December 5, 2009, the Company entered into an agreement to determine the

purchase of the shares of TFB Corporation N.V. and subsidiaries (Wal-Mart

Centroamérica) through a related party. Through this transaction, the Company

shal l acquire the assets and assume the l iabi l i t ies of TFB Corporation N.V. and

subsidiaries, and as of the date on which the acquisit ion is effect ive, the Company

shal l carry out business activi t ies in the Central American region.

NOTE 18 – PROFORMA FINANCIAL STATEMENTS:

a. Basis of preparation

The consolidated f inancial information shown in the columns “Base Figures”

includes the Company’s f inancial information.

The preparation of the f inancial information in conformity with Mexican Financial

Report ing Standards requires management to make estimates and assumptions in

certain areas, which affect the amounts reported in the f inancial information and

the disclosures in the accompanying notes. Although such estimates are based on

management’s knowledge of present situations and condit ions, actual results

could dif fer from these estimates.


b. Proforma consolidated f inancial information

The Company’s proforma consolidated f inancial information for the presented

years has been prepared for the sole purpose of presenting the Company’s

f inancial information, the results of i ts operations, the changes in i ts shareholders’

equity and i ts cash flows with the effects of the transaction as though i t had

occurred at the dates of these f inancial statements, as fol lows:

• Proforma balance sheet at December 31, 2008 and 2007- As though the

transaction had occurred at December 31, 2007.

• Proforma results of operations for the years ended December 31, 2008 and

2007 - As though the transaction had occurred at January 1, 2007.

• Proforma statement of changes in shareholders’ equity for the years ended

December 31, 2008 and 2007 - As though the transaction had occurred at January

1, 2007.

• Proforma statement of cash f lows for the years ended December 31, 2008

and 2007 - As though the transaction had occurred at January 1, 2007.

Under terms of the acquisit ion agreement, the Company shal l pay a port ion of the

consideration in cash and the remainder through the issuance of ordinary shares

to the current shareholders of Wal-Mart Centroamérica. The transaction is subject

to the usual closing condit ions, including approval by the shareholders of the

Company and Wal-Mart Centroamérica.

For book purposes, this transaction shal l be recorded as a business acquisit ion in

conformity with Mexican Financial Reporting Standard (Mexican FRS) B-7, revised

and effect ive as of January 1st, 2009. In accordance with this Mexican FRS, this

transaction must be accounted for using the purchase method, which requires the

consideration del ivered, as well as the identi f iable assets and assumed l iabil i t ies

result ing from the acquisit ion be valued at their fair value at the acquisit ion date.

The dif ference between these two values shal l be the amount of goodwil l .


Proforma adjustments – These correspond to the assumptions used by

Management for the prel iminary distr ibut ion of the estimated purchase price

(consideration) to the tangible and intangible assets that wi l l be acquired and the

l iabi l i t ies that wi l l be assumed, based on the prel iminary estimates of their fair

values at September 30, 2009, as described below:

Purchase price

- Consideration - A cash payment of approximately Ps. 1,400 mil l ion wil l be

made, and 593 mil l ion Company shares, which wil l be issued at the signing

of the corresponding agreements, wi l l be del ivered. The f inal amount wil l

be adjusted at the date the transaction is concluded and may dif fer as a

result of (1) changes in the net assets of Wal-Mart Centroamérica that

occur prior to the f inal conclusion of the transaction and could affect the

purchase price and (2) the exchange rate used at the t ime of the

transaction, since the transaction wil l be agreed in U.S. dol lars. The

exchange rate used for this transaction was Ps. 13.1833 per dol lar.

- Contingent consideration – As part of the acquisit ion price, subsequent

payments wil l be made in cash and in shares. The cash payments wil l

consist of a f ixed port ion and a variable portion. For the payment in shares,

at the shareholders’ meeting, the Board wil l propose the issuance of

approximately 55 mil l ion shares, which shal l remain as treasury shares not

subscribed or paid in, to be del ivered to the current shareholders of Wal-

Mart Centroamérica in the case that the acquired Company achieves a pre-

establ ished level of prof i tabi l i ty in a term of no longer than 10 years. Such

payments shal l be determined at their present value and may dif fer as a

result of (1) circumstances that could indicate that the results wi l l not be

achieved as per project ions and (2) the exchange rate used at the t ime of

the transaction, since i t was agreed in U.S. dol lars.

Fair value of the identi f iable assets and assumed l iabi l i t ies as a result of the

purchase.


The distr ibution of the purchase price shal l remain prel iminary unti l the

Company’s Board determines the fair values of the assets acquired and l iabi l i t ies

assumed, for which i t has one year as of the acquisit ion date.

The book values of the current assets and l iabi l i t ies are similar to their fair value.

The fair value of property and equipment, as well as of intangible assets, was

determined based on the estimated values of such assets acquired and l iabi l i t ies

assumed, which could subsequently be modif ied at the t ime the fair values are

determined.

Goodwil l is recognized when the amount of the consideration valued at i ts fair

value, as described in the preceding paragraphs, exceeds the amount of the net

assets acquired at their fair value. For purposes of these proforma f inancial

statements, goodwil l is presented as part of the caption "Other assets" and is

considered to be part of the acquired business; therefore, the value in pesos is

dif ferent in each period presented and the variance is recorded in the caption

"Cumulative translat ions adjustment” in shareholders' equity, in conformity with

Mexican FRS B-15.

Operating costs include fees payable for bank investment services, legal services,

accounting services and other advisory services. These costs are recognized as

an expense as they are incurred and are ref lected as a decrease in the retained

earnings.

Result ing proforma f igures – These correspond to the Company’s consol idated

f inancial information after recognizing the aforementioned proforma adjustment

f igures.

NOTE 19 – ISSUANCE OF THE FINANCIAL STATEMENTS:

The accompanying f inancial statements and notes at December 31, 2008 and

2007 were approved by the Company’s Board of Directors at a meeting held on

February 11, 2009. In addit ion, with regard to Notes 17 and 18, the f inancial

statements were authorized for their issuance on December 5, 2009 by the

Executive Vice President and Chief Financial Off icer.

9.2. Extraordinary Shareholders Meeting Notice, Wal-Mart de México


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