Carrefour has struck a deal to buy Brazil’s third-largest food retailer Grupo Big from Walmart for €1.1bn (£950m).

The French supermarket giant, which is already the biggest grocer in Brazil, is funding 70% of the transaction in cash. The remaining 30% will come in the form of new Carrefour Brazil shares.

Carrefour said the acquisition would create annual synergies of around €260m (£224.5m) within three years of the deal completing.

The purchase, which would take the combined revenue of Grupo Big and Carrefour’s 72%-owned Brazilian unit to around €15.2bn (£13.1bn), is now subject to approval by Carrefour Brazil’s shareholders and the Brazilian antitrust authorities.

Carrefour expanded into Brazil in 1975 and has grown into the largest food retailer in the country, with 489 stores.

The combination with Grupo Big, which is jointly owned by Walmart and Advent International, would grow the business to 876 stores and around 137,000 staff.

Carrefour chair and chief executive Alexandre Bompard said: “Our Group is on the offensive: the acquisition of the Big Group is a major transformation movement for Carrefour Brazil.

“In this continental country with immense development prospects, we have accentuated our leadership in the food distribution market over the past three years, and Big will further strengthen it with very complementary formats and locations.”