Walmart, Li & Fung Form New Sourcing Agreement
HONG KONG-Walmart has reached a new sourcing agreement with Li & Fung, which supercedes the previous agreement from January 2010.
Under the terms of the new arrangement, Li & Fung's wholly owned subsidiary, Direct Sourcing Group, will continue to serve as buying agent for Walmart U.S and certain Walmart International markets on a category-specific basis under terms similar to the previous agreement. Also, Direct Sourcing Group will continue as the primary direct source for Sam's Club in the United States. In addition, the two companies terminated the option from the previous agreement in which Walmart could choose to buy all of Direct Sourcing Group's shares on or after Jan. 1, 2016.
The new agreement will continue for five years, with an option to extend for an additional two years.