Reliance Industries’ (RIL) retail arm Reliance Retail Ventures Limited (RRVL) on Thursday signed definitive agreements to acquire a 100% equity stake in Metro Cash and Carry India Pvt Ltd, which operates under the ‘Metro India’ brand, for a cash consideration of Rs 2,850 crore. “Through this acquisition, Reliance Retail gets access to a wide network of METRO India stores located in prime locations across key cities, a large base of registered kiranas and other institutional customers, strong supplier network and some of the global best practices implemented by METRO in India,” Mukesh Ambani’s Reliance said in a statement.
At present, Metro India serves kiranas and other small businesses and merchants. In the financial year 2021-22, the company generated sales of Rs 7,700 crore, its best sales performance since its market entry into India. The company started operations in India in 2003 as the first company to introduce cash-and-carry business format in the country, and it now runs 31 large format stores across 21 cities with about 3,500 employees. The multi-channel B2B cash-and-carry wholesaler has a reach of over 3 million B2B customers in India and 1 million of them are frequent buyers through its store network and eB2B app, according to Reliance regulatory filing.
The acquisition is expected to help Reliance Retail’s physical store footprint and the “ability to better serve consumers and small merchants by leveraging synergies and efficiencies across supply chain networks, technology platforms and sourcing capabilities,” Reliance said in a regulatory filing. The transaction is subject to certain regulatory and other customary closing conditions and is expected to complete by March 2023.
Talking about the acquisition, Isha Ambani, Director, Reliance Retail Ventures Limited, said, “The acquisition of Metro India aligns with our new commerce strategy of building a unique model of shared prosperity through active collaboration with small merchants and enterprises.” Reliance Retail will continue to widen its reach across the country to serve the entire spectrum of Indian society – from households and kiranas to merchants, and from hotels, restaurants, and catering to small and medium enterprises and institutions – with the help of this acquisition, the company added.
The acquisition comes days after Reliance Consumer Products, the fast-moving consumer goods (FMCG) arm and a wholly owned subsidiary of Reliance Retail Ventures launched its consumer packaged goods brand, Independence, in Gujarat. Isha Ambani at Reliance Industries‘ 45th annual general meeting in August had announced that the company would foray into the FMCG space this year. Independence will offer a wide range of products under several categories, including staples, processed food and other daily essentials. It plans to develop Gujarat as a “go-to-market” state to create excellence in execution for its FMCG business, as it prepares for a national rollout for the brand, the company said.