Reliance Industries will buy German retailer METRO AG’s Cash and Carry business in India in a deal valued at around 500 million euros (Rs.
4,060 crore),” industry sources said.
The deal includes 31 wholesale centers, state-owned banks, and other assets owned by METRO Cash and Carry, they said.
This will help the country’s largest retailer, Reliance Retail, expand its presence in the B2B segment.
Talks between Reliance Industries and the Mukesh Ambani-led METRO have continued for the past few months, and last week the German parent company accepted Reliance Retail’s offer, they added.
When contacted, METRO and Reliance Industries declined to comment on the development. A Reliance spokesman said: “Our company is constantly evaluating various options.” A spokesman for METRO AG said: “We do not comment on rumors or market speculation.”
METRO Cash and Carry customers include Kiran retailers and shops, hotels, restaurants, and eateries (HoReCa), enterprises, SMEs, enterprises, and institutions.
The B2B segment is considered a low-margin business, and international companies such as Carrefour left the country in 2001.
In July 2020, major e-commerce group Flipkart acquired 100% of Best Price Walmart India Pvt. Ltd.’s shares, cash, and transport businesses.
Other retailers are looking to buy METRO Cash and Carry, including Siam Makro, which manages Lots Wholesale’s cash and carry business under the LOTS Wholesale Solutions brand.
Siam Makro, part of Thailand’s Charoen Pokphand Group, announced last month that it was withdrawing from METRO Cash and Carry India.
METRO AG, which operates in 34 countries, entered the Indian market in 2003.
It has six stores in Bengaluru, four in Hyderabad, two each in Mumbai and Delhi, and one each in Kolkata, Jaipur, Jalandhar, Zirakpur, Amritsar, and Ahmedabad; Surat, Indore, Lucknow, Meerut, Nasik, Ghaziabad, Tumakuru, Vijayawada, Visakhapatnam, Guntur, and Hubballi.
Reliance Retail Ventures Ltd. (RRVL), a subsidiary of Reliance Industries, is the holding company for all the retail businesses of the group. The consolidated turnover of RRVL for the year ended March 31, 2022, was approximately 2lakh crore.