Sale of the business in India
On 22 December 2022, METRO signed an agreement to sell METRO India to Reliance Retail Ventures Limited (Reliance). Due to the increasing level of market consolidation, the accelerated digitalisation and the intense competition, the business of METRO India no longer aligns with METRO’s sCore growth strategy. The sale of METRO India, including all 31 wholesale stores and the entire real estate portfolio (6 store locations), to Reliance was successfully concluded on 11 May 2023.
METRO AG is providing certain transitional services and licences as part of the transaction to enable the new owner to operate the business.
As a result of their classification as assets and liabilities held for sale, after consolidation measures carried out as of the date of deconsolidation, €303 million was recognised under the item assets held for sale in the consolidated balance sheet and €238 million was recognised under the item liabilities related to assets held for sale.
Based on the monthly financial statements as of 30 April 2023, the assets and liabilities disposed of as part of the deconsolidation consist of the following:
€ million |
|
|---|---|
Assets |
303 |
Other intangible assets |
1 |
Property, plant and equipment |
171 |
Financial assets |
9 |
Other financial assets (non-current) |
2 |
Other non-financial assets (non-current) |
3 |
Inventories |
60 |
Trade receivables |
5 |
Other financial assets (current) |
11 |
Other non-financial assets (current) |
18 |
Income tax assets |
2 |
Cash and cash equivalents |
21 |
|
|
Liabilities |
238 |
Provisions for post-employment benefits plans and similar obligations |
3 |
Borrowings (non-current) |
103 |
Trade liabilities |
45 |
Borrowings (current) |
73 |
Other financial liabilities (current) |
7 |
Other non-financial liabilities (current) |
7 |
Taking into account the outgoing cash and including the prepayment for use of the METRO brand, the preliminary net cash inflow for the disposed assets and liabilities amounts to €0.3 billion.
The positive EBITDA-effective earnings from the disposal of METRO India amounts to €150 million, including transaction costs. It is fully attributable to the segment East and is allocated to transformation gains as a portfolio measure.
The components of other comprehensive income from currency translation differences attributable to the shareholders of METRO AG still included in the equity of METRO India until the date of deconsolidation had an effect of €−44 million in the financial result due to the derecognition through profit or loss.
No expenses were incurred in conjunction with the valuation of the disposal group at fair value less costs of disposal.