Reliance Retail to turn Metro stores into destination retail outlets

Metro sold only to business customers as its German parent had to comply with India's FDI norms

After acquiring Metro AG's India wholesale business, Reliance Retail is planning to turn the stores into destination retail outlets, The Economic Times reported. These stores will then cater to both trade and consumers.

Reliance Retail plans to sell groceries, value fashion and electronics at these outlets. It also has plans to onboard these stores on the JioMart shopping app, a senior industry executive aware of the plans told the publication.

The report said some of the stores will also have cafes.

Reliance Industries' subsidiary Reliance Retail Ventures, the holding company for Reliance Retail, signed definitive agreements last month to acquire all of Metro Cash & Carry India for Rs 2,850 crore.

Reliance got 31 large format stores in 21 cities as well as a real estate portfolio as part of the deal.

 
So far, Metro sold only to business customers such as neighbourhood stores, hotels, restaurants, caterers and others with a business or goods and services tax (GST) licence as its German parent had to comply with India’s norms that only allow 100 per cent FDI in cash-and-carry or wholesale trade.

But the Reliance deal, once approved by the government, will allow the new Indian owner to trade as well as sell to consumers. The deal is expected to complete by March, the ET report said.

However, the deal terms mandate that the stores continue under the Metro brand for three years.