Metro to become a Czech company?

Czech billionaire Daniel Kretinsky and Slovak investor Patrik Tkac may be making an offer to take over Metro soon: the two have already acquired portions of the holding behind the Metro and Makro chains.

 

Milestone approaches

Kretinsky and Tkac's investment fund, Global Commerce (EPGC), has acquired a 7.3 % stake in the German Metro group: the two men are taking over the shares from investor Franz Haniel, who is slowly retreating from the ailing group after fifty years. That may be why Kretinsky and Tkac have already expressed interest in acquiring Haniel's remaining 22.5 % as well, if Metro can show better prospects. According to Reuters, that condition has not stopped EPGC from entering into talks with Ceconomy, which used to be part of Metro, to buy its 10 % participation.

 

EPGC has only been a Metro shareholder since last year, but they immediately bought 10 % of the shares. If the investment vehicle is looking to increase its participation beyond 30 %, German law requires that they make a public offer to acquire Metro right away. That offer may come in a few months' time, according to Reuters.

 

Stock market happy

It is not yet clear what Kretinsky sees in Metro: Haniel wants to sell it because the share's losses have cost the investor half a billion euros in the last few years. Moreover, only last summer the distribution group's shareholders were demanding better results for this year.

 

Kretinsky is a newcomer in the retail world: his wealth was made as top executive and owner of EPH, one of Europe's major energy producers. Trained as a lawyer, Kretinsky is also the co-owner of Blesk, the most popular magazine in the Czech Republic, as well as French newspaper Le Monde.

 

In any case, investors have responded to the possible acquisition with enthusiasm: the rumours have boosted the share's value by 11 %. Metro's value on the stock market is about 5.5 billion euros. Turnover decreased by 0.6 % in the past quarter, but those numbers were actually better than what was expected. On a comparable basis, there was a 2.3 % growth rate and the group's restructuring efforts are finally proving fruitful.