The Business Bytes
TBB BUREAU
MUMBAI, DEC 22, 2022
Reliance Retail Ventures Ltd. (RRVL), a subsidiary of Reliance Industries Ltd., on Thursday said it has signed definitive agreements to acquire 100% equity stake in Metro Cash & Carry India Pvt Ltd. for a total cash consideration of Rs 2,850 crore, subject to closing adjustments.
METRO India started operations in India in 2003 as the first company to introduce cash-and-carry business format in the country and currently operates 31 large format stores across 21 cities with about 3,500 employees. The multi-channel B2B cash & carry wholesaler has reach to over 3 million B2B customers in India, of which 1 million are frequently buying customers, through its store network and eB2B app.
METRO India has established itself as a trusted partner for kiranas and other small businesses and merchants. In the financial year 2021/22 (FY ended September 2022), METRO India generated sales of Rs 7700 crore (€ 926 million), its best sales performance since its market entry into India.
Through this acquisition, Reliance Retail gets access to a wide network of METRO India stores located in prime locations across key cities, a large base of registered kiranas and other institutional customers, strong supplier network and some of the global best practices implemented by METRO in India. The acquisition will further strengthen Reliance Retail’s physical store footprint and ability to better serve consumers and small merchants by leveraging synergies and efficiencies across supply chain networks, technology platforms and sourcing capabilities. The symbiotic relationship will create greater value for all stakeholders in the retail ecosystem.
Speaking about this investment, Reliance Retail Ventures Limited Director Isha Ambani said, “The acquisition of METRO India aligns with our new commerce strategy of building a unique model of shared prosperity through active collaboration with small merchants and enterprises. METRO India is a pioneer and key player in the Indian B2B market and has built a solid multi-channel platform delivering strong customer experience. We believe that METRO India’s healthy assets combined with our deep understanding of the Indian merchant / kirana ecosystem will help offer a differentiated value proposition to small businesses in India.”
“With METRO India, we are selling a growing and profitable wholesale business in a very dynamic market at the right time. We are convinced that in Reliance we have found a suitable partner who is willing and able to successfully lead METRO India into the future in this market environment. This on one hand will benefit both our customers and our employees, for whose loyalty and performance we are very grateful, and on the other hand will enable METRO to focus on accelerating growth in the remaining country portfolio,” said Dr. Steffen Greubel, CEO of METRO AG.
With the acquisition of METRO India, Reliance Retail will continue to build reach across the country to serve the entire spectrum of Indian society i.e. households, kiranas and merchants, HoReCa and small and medium enterprises and institutions, and be the partner of choice, and enable win-win opportunities for producers, brand companies and global suppliers.
The transaction is subject to certain regulatory and other customary closing conditions and is expected to complete by March 2023.
