Brazilian grocer Companhia Brasileira de Distribuicao (CBD) will pay some 1.26 billion Brazilian reals, or $650 million, to acquire local retailer Ponto Frio, CBD's financial adviser said Wednesday.

On Monday, CBD announced the acquisition of Globex Utilidades SA (GLOB3.BR), the majority owner of Brazilian retailer Ponto Frio. It will pay an initial BRL824.5 million to acquire a 70.24% stake in Ponto Frio, held by Globex.

CBD said it will hold a public tender offer to acquire outstanding Globex shares for 80% of the value paid to the controllers. CBD's financial adviser, local company Estater, said total cost of the acquisition, including the initial payment to Globex plus the purchase of minority stakes, will be approximately BRL1.26 billion.

With the acquisition, CBD said it will resume its previous status as Brazil's largest retailer, with annual revenue worth BRL26 billion. According to CBD, the previous market leader was France's Carrefour SA (CA.FR).

The operation still must be approved by Brazil's government antitrust bodies.

CBD is jointly controlled by the Diniz family of Sao Paulo, the chain's founders, and by French retail company Casino Guichard-Perrachon SA (CO.FR). Its main competitors in Brazil include U.S. retail giant Wal-Mart Stores Inc. (WMT) and Carrefour.

-By Rogerio Jelmayer, Dow Jones Newswires; 55-11-2847-4521; rogerio.jelmayer@dowjones.com