The stock valuation of German hypermarket chain Metro has taken a heavy hit over the past week, and the retailer's plans to launch an initial-public-offering of its Russian unit has been thrown into doubt due to the fallout of the current situation in Ukraine.
Over the weekend, Metro shares fell by over 5% in early trading on the German mid-cap stock exchange to €28.50.
Metro had hope to raise around €1 billion by selling 25% of its stake in its Russia cash-and-carry unit in a London listing but due to Russia's involvement in the political chaos surrounding Ukraine, details of the group's plans aren't currently clear.
A Metro spokesperson said it would "monitor the situation in Ukraine closely" because market conditions need to be favourable in order to launch an IPO.
Metro planned to use the proceeds from the IPO to expand its cash-and-carry business in Russia, its most profitable unit and the country's fourth-biggest retailer behind X5 (PJPq.L), Magnit (MGNTq.L) and French chain Auchan.
Metro operates 72 stores in Russia and achieved sales of 183 billion roubles in 2013.
© 2014 - European Supermarket Magazine by Enda Dowling
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