Metro seeking buyers for China business

Date : 21 March 2019

German wholesaler Metro has called for bidders for its operations, kicking off the official sale process.

A deal valued between US$1.5bn and US$2bn

Metro, owns 95 stores in China as well as real estate assets in several major cities such as Beijing and Shanghai, is seeking a deal that would value the business from US$1.5bn to US$2bn.

It is reported that the decision to exit China is a part of Metro’s global plan to focus on its worldwide wholesaler activities and in response to disruptions from online players in China. We previously reported that its convenience stores were shut down in China in 2017. 

Potential bidders

There are several potential bidders, including local supermarket operators Wumart and Yonghui, as well as electronics retailer Sunning.

Alibaba has previously been in talks with Metro about taking a stake in Metro’s China business. Its interest is partially driven by its desire to bring online capabilities to offline. Partnering with Metro could bring synergy to Alibaba’s offline business Hema (now called Freshippo). Alibaba’s rival Tencent formed a strategic partnership with Carrefour in 2018.

Metro restructuring its business

Metro has been restructuring in recent years to focus on its core business. It is selling Kaufhof department stores and splitting from consumer electronics group Ceconomy.

Meanwhile, it opened a new warehouse in Yangon last week in Myanmar to focus on online sales for corporate customers and building a fresh food supply chain.

 

 

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