Reliance Retail Ventures acquires METRO India in multi-crore deal
Delhi, German retailer METRO AG on Thursday announced the completion of the sale of its Indian cash & Carry business to Reliance Retail Ventures Ltd (RRVL), which holds the retail empire of Reliance Industries Ltd. The deal includes all 31 wholesale stores operated by METRO Cash & Carry India and the entire real estate portfolio (6 store-occupied properties) to RRVL, said Metro AG in a statement. “METRO India will complement Reliance Retail’s retail network in the future,” it said. In accordance with the agreement, “all METRO India stores will continue to operate under the METRO brand during an agreed-upon transition period.”
However, it also said, “For METRO employees and METRO customers, there will be no noticeable changes for the time being.” METRO and RRVL in December 2022 announced a deal for the acquisition of German firm’s wholesale operations in India by billionaire Mukesh Ambani-led enterprise for Rs.2,850 crore. The agreement will assist Reliance Retail in solidifying its hegemonic position in India’s massive retail industry, one of the world’s fastest-growing marketplaces.
Steffen Greubel, CEO of METRO AG, offered the following statement in response to the news: “With today’s successful closure of the transaction, METRO India will begin a new chapter in its history. We are confident that Reliance, as the new owner, will successfully steer the company into the future thanks to its local knowledge.
He also expressed gratitude to the METRO Indian staff for their 20 years of dedication and hard work and wished them well in their next chapter. METRO will continue to build on its growth momentum and take further steps to achieve its mid- and long-term ambitions.
The statement read: “Cash proceeds of 0.3 billion will further reduce METRO’s net debt (the total effect on net debt is, therefore, more than 0.4 billion) and will support METRO’s Core strategy implementation. This reduction in net debt is in addition to the 0.15 billion reduction in net debt already realized in Q1 through the reclassification of the Indian business as “Asset held for sale.” RRVL is the holding company for the retail business of Reliance Industries.
Reliance Retail’s operational revenue for the fiscal year ending March 31, 2023, was Rs.2.30 lakh crore. The company is focusing to expand its distribution network across geographies as well as a product offering in the Consumer Brands business. METRO is a large multinational food wholesaler, operating in more than 30 countries. In the financial year 2021/22, METRO generated sales of 29.8 billion Euros.
