Nearly tenth of group turnover
“As long as the sanctions against Russia do no influence trade flows, they should have no impact on our business. Purchasing power in Russia is there, the demand for supplies is there“, Olaf Koch stated in an interview. Right now, sanctions are restricted to travel limitations and frozen assets of several Russian leaders.
The Metro CEO is nevertheless keeping an fearful eye on how the conflict between the West and Russia about the Krim’s annexation will evolve, which is rather logical as the German concern manages 9 % of its total turnover in Russia. Metro is Russia’s fourth largest retailer, with a 3.6 billion euro turnover, trailing local duo X5, Magnit and French Auchan.
IPO delayed
The situation has forced Metro to put an IPO on hold, that of its Russian cash-and-carry subsidiary. Normally, 25 % of that stock would have brought in 1 billion euro, which would have allowed the company to speed up its Russian expansion both this and next year.
A delay does not mean it will be scrapped in the end. “We want to do more in Russia, that’s for sure. The upcoming weeks will be important for the question of when there will be an IPO. The strategic significance and the economic attractiveness of the transaction are still given on our view. But without a stable environment a transaction is not reasonable.”
The Metro share is suffering because of the situation in the Ukraine, as it has lost 19 % of its value since the beginning of the year. The average German share dropped 2.3 %, to illustrate how Metro is impacted by that crisis.
