Canadian retailer HBC to acquire Metro AG’s department store business
15 Jun 2015
Canadian retailer Hudson's Bay Company (HBC) would acquire the department store business of German retail and wholesale group Metro AG in a deal worth just over €2.8 billion.
According to the two companies, the deal would include the Galeria Kaufhof chain in Germany and Galeria Inno in neighboring Belgium, as also the business's real-estate portfolio.
HBC would take over 103 Galeria Kaufhof stores in Germany, 16 Sportarena stores and 16 Galeria Inno stores in Belgium.
According to Metro, it expected to cut its net debt by €2.7 billion from the transaction and foresaw a roughly €700 million boost to pre-tax earnings. The companies said, the total transaction valued at €2.825 billion included "the assumption of certain liabilities."
The German and Belgian chains would continue to operate under their current brand names and "no significant changes" to branches or staffing were expected, they companies said. Galeria Kaufhof would continue to have its headquarters in Cologne and its current management would remain in place.
The deal would likely close by the end of September.
The sale would have a positive effect of around €700 million on earnings before interest and tax (EBIT), Metro said.
