Metro in talks with several investors to sell Kaufhof unit

German retailer Metro Group has confirmed that it is 'in talks' over a potential sale of its department store chain Galeria Kaufhof, but added that negotiations with investors are still at an early stage. 'We are not in exclusivity, the process is not that far yet,' a Metro spokesperson told PropertyEU.

The Galeria Kaufhof business is worth between EUR 2 bn and EUR 3 bn with the company owning half of its roughly 140 stores. During the presentation of the company's first-quarter results, Metro's Chief Executive Eckhard Cordes said that Kaufhof has been 'an excellent department store business', with nearly EUR 4 bn of sales in 2009, and currently represents a 'very attractive asset for potential investors.'

He added that the company is not under any time pressure to sell. 'We are in a very comfortable situation, we do not want the easiest way out, but the best', he said. The company initially hoped to complete the sale by June 2010 but Cordes said it might now take longer.

Metro's sale of Galeria Kaufhof comes at the same time that administrators are trying to sell the insolvent Arcandor's Karstadt department store unit, with the move giving potential investors a possibility to merge the two businesses. According to Cordes, Metro is not interested in buying Karstadt. 'We are now in a seller position', he said.

Metro announced plans to sell its Kaufhof non-strategic unit in 2008 but the divestment was put on hold amid the financial crisis and a failed attempt to merge Kaufhof with the Karstadt department store chain.