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Metro to sell department store subsidiary Kaufhof

RBR Staff Writer Published 30 September 2013

German department store chain Metro intends to divest its subsidiary Kaufhof, which has shown better valuation compared to last year and is also performing well.

Metro chief executive Olaf Koch was quoted by Reuters citing WirtschaftsWoche magazine that Kaufhof clearly has a better valuation compared to early last year when the company was in talks to sell the chain.

The company ruled out a merger with German department store operator Karstadt, which has divested a stake in its luxury and sports stores to Austrian investor Rene Benko earlier this month.

In early 2012, Metro has withdrawn the proposed sale of its Kaufhof department stores because of unfavorable financial market conditions.

"The department store business cannot be internationalized in the same way as the wholesale or consumer electronics business. Return on investment is substantially lower."

Metro is a food, apparel and electronic products retailing company. It operates through various retail formats comprising cash and carry warehouses, hypermarkets, consumer electronic stores and departmental stores under banners such as Metro Cash & Carry, Real, Media Markt and Saturn and Galeria Kaufhof.