Walmart to buy Apple, Google for $1.2 billion

NEW YORK — Walmart has agreed to buy the smartphone maker Apple for $7 billion, the company said Tuesday, setting up a potential bidding war with Amazon and Google.

The agreement, which includes the acquisition of the Chinese online retailer, marks a major coup for the world’s largest retail retailer.

Wal-Mart said it will pay $1,735 per share for the combined company.

“It is an important step forward in our strategic plans to align our brands, technologies and brands’ businesses with our customers’ needs and goals,” Walmart Chief Executive Doug McMillon said in a statement.

McMillon said that Apple’s products and services would continue to be developed and distributed in the U.S., and that Apple would continue its expansion in China.

Google Inc. will continue to sell its Android smartphones and tablets, and that Amazon will continue its sales of online games.

Under the deal, Wal-Mart will pay Amazon $3.5 billion in cash, plus $400 million in stock, and $1 billion in stock-based compensation, the announcement said.

Amazon will pay Wal-mart $3 billion in the first quarter of 2020.

Apple has a market value of about $130 billion.

Analysts polled by Thomson Reuters had expected the deal to close at about $7.50.

Shares of Wal-Marts stock closed up 0.2 percent, or $1 a share, at $1123.99 in afternoon trading in New York.

Last year, Walmart said it planned to buy Motorola Mobility Inc. for $13 billion.

The deal could help Wal-Mar Stores Inc., which already operates a Walmart store in Seattle, reach a larger number of customers.

Wal-Marks shares have gained more than 13 percent over the last year, the most in more than 20 years.

The deal follows similar ones by other tech giants including Google and Amazon.

Walmart shares have surged more than 50 percent over 2014 as demand for smartphones and other gadgets has surged in China and the U!

McDonald’s Corp., the world s largest hamburger chain, has also announced it will buy chip maker Qualcomm Inc. from Intel Corp. in a $1-billion deal.

Both Apple and Google are investing heavily in China to expand their presence in the market, which accounts for more than half of all smartphone shipments worldwide.