FILE PHOTO: Two people walk outside a Wal-Mart store in Mexico City January 11, 2013. REUTERS/Edgard Garrido

MEXICO CITY (Reuters) – Walmart de Mexico, Mexico’s biggest retailer, said on Thursday that it reached a deal with a union that had demanded pay hikes, although the group countered that talks were still underway and that a strike remained on the table.

The company said in a statement that it struck the agreement on Wednesday with the Revolutionary Confederation of Laborers and Farmworkers (CROC), offering its workers an average annual salary increase of 5.5 percent.

However, CROC spokesman Eduardo Miranda said the parties had not signed an agreement and that the union had not withdrawn its intent to strike if negotiations did not conclude by March 20.

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