Majority stake in Metro sold to Wumei Technology Group in 1.5b euro deal

The closing of this transaction will allow Metro China and Wumei to proceed with an in-depth strategic review to identify opportunities to integrate aspects of their operations, enrich the product offerings and expand their customer reach, according to Wumei.

The deal aligns with Metro AG's global strategy to focus on its wholesale business.

"The closing of this deal…will provide us with financial flexibility and optionality to further strengthen our strategy of focusing purely on wholesale," said Olaf Koch, chairman of the Metro AG management board.

"Given Metro China's strong foundation and Wumei's strengths and resources, the business is poised to open a bright new chapter as a leading player in China's dynamic and growing retail marketplace," Koch added.

Metro China is a profitable business serving 8 million buying customers with 2.7 billion euro insales during fiscal year 2017 to 2018. It operates 97 stores across China, 47 of which are owned properties. 

Sales at Metro China have been growing continuously over the past decade, almost doubling the sales volume of 2010. It also outperformed the market with more than 5 percent sales growth like-for-like in fiscal year 2019 amid challenging market conditions.

Thanks to sound profitability, Metro China has been able to make debt-free investments of about 200-400 million yuan each year on its own to strengthen its operations.

Metro AG will appoint two board members to the board of directors of Metro China's holding company and Wumei, in its capacity as majority shareholder, has assigned one of its nine board seats to  Sarrailh.

Metro AG will ensure a voice in the company's governance and strategic direction.  A quality control committee headed by Metro AG's representative will be fully engaged to monitor and ensure the ongoing quality and operational standards being in compliance with Metro's global framework.