Jul 12, 2017
Metro to split on Thursday after court allows demerger
Jul 12, 2017
German retailer Metro will list as two separate companies after a German court gave the green light on Wednesday for the conglomerate to split its food business from its consumer electronics unit.
Shareholders in Metro voted in February to back the plan to split the group's wholesale and hypermarket food business from Media-Saturn, Europe's biggest consumer electronics group, by the middle of the year.
But Erich Kellerhals, the founder of Media-Saturn, as well as other shareholders, launched a legal challenge.
Metro said in a statement that a Duesseldorf court had entered the planned split into the commercial registry on Wednesday, meaning the demerger had come into effect and any pending lawsuits could no longer stop the plan.
Metro said shares for Metro Wholesale & Food Specialist AG will be listed on Thursday, while the consumer electronics business - renamed Ceconomy - will trade independently for the first time.
Metro hopes the split will help the independent companies pursue more acquisitions and trigger a revaluation of the stock as Metro currently trades at a discount to other pure wholesale retailers such as Sysco and Britain's Booker .
Shares in Metro, which have sagged on uncertainty about the court proceedings, were up 1 percent at 0830 GMT (9.30 a.m. BST).
In May, the consumer electronics division reported a loss due to heavy investment before the split.
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