Wal-Mart's Asda to buy UK rival Netto for $1.1b

US retailer Wal-Mart (WMT.N), is buying Netto UK from its Danish owner for 778 million pounds ($1.1 billion) and will convert the stores to its Asda brand, cementing its position as the UK’s number two grocer.
Wal-Mart Stores Inc, the world's largest retailer, generates about 25 percent of its annual $405 billion sales outside the U.S. It bought Britain's Asda, in 1999.
Asda said on Thursday it was buying discounter Netto's 193 stores in the UK and would convert them to an Asda fascia by summer 2011.
Dansk Supermarked, majority-owned by Danish conglomerate AP Moller-Maersk (MAERSKb.CO), said it would now focus on expanding Netto in Scandinavia and Northern Europe.
Collins Stewart analyst Greg Lawless said the deal would help Asda to fulfill one of its main ambitious -- to become a clear UK number two in food.
Asda is currently Britain's second-biggest supermarket group ahead of J Sainsbury (SBRY.L), but only thanks to its stronger position in non-food ranges.
The top supermarket groups in the UK have been battling to extend their reach into smaller format stores.