In a dramatic u-turn Wal-Mart, the largest grocer in the US and the second largest in the world, has taken a coy step back from the active support it was previously giving to gay-rights groups.

The anti-gay American Family Association (AFA) threatened to boycott Wal-Mart’s next big sales period and condemned the blanket support it offered to gay-friendly business initiatives.

The company succumbed to the AFA’s latest threat to urge shoppers to boycott their post-Thanksgiving sale.

The AFA had previously pressured the grocer by urging families to avoid the supermarkets on Saturdays and Sundays, which are the busiest shopping days in the week, seriously impacting Wal-Mart’s business.

The company, which owns British retailer ASDA, was in the news in August 2006 for supporting the National Gay and Lesbian Chamber of Commerce, in an effort to advance diversity within the store’s associate, supplier and customer bases.

This latest volte-face has been accompanied a mixed message from the company’s Communications Office’s vice-president, Mona Williams.

She said that although the company will continue to support “workplace equality,” it chooses to opt out of commenting on “controversial” issues which were causing concern to its customers.

She denies that Wal-Mart was bullied by the AFA boycott.

“Going forward, we would partner with [gay rights groups] on specific initiatives, as opposed to just giving blanket support to their general operating budget,” she said.

Wal-Mart also denied allegations made by conservative groups that the company was giving preferential treatment to gay businesses.

Reverend Flip Benham of Operation Save America said:

“Wal-Mart has been Christian families’ favourite store and now it is giving in, sliding down the slippery slope so many other corporations have gone down, all being extorted by the radical homosexual agenda.”

The President of the Gay and Lesbian Chamber of Commerce said that conservative activists misrepresent his business-oriented group, which is a leading advocate of gay marriage, “in order to tarnish Wal-Mart.

“Their campaign has not been to educate, but to mislead,” he said.

The US is becoming increasingly conflicted over gay issues, with the fight against gay rights led by conservative pressure groups.

Some maintain that the corporation’s apologetic retraction was indicative of Wal-Mart corporate culture in the light of the fact that the company has frequently been accused of self-interest.

It has been the target of denunciation from many community groups, including women’s rights activists and labour unions.

The company’s latest critics are now gay rights groups.