FRANKFURT, July 13 (Reuters) - German retailer Metro completed its split into two companies on Thursday as its food business and consumer electronics division started trading independently on the Frankfurt and Luxembourg stock exchanges.
Shares in the Metro food business traded at 19.70 euros by 0709 GMT, while those of the consumer electronics business, to be renamed Ceconomy were at 9.25 euros, compared to 29.185 euros for the combined group at the close of trading on Wednesday.
Metro hopes the split will allow the independent companies to pursue more acquisitions and trigger a revaluation of the stock as Metro has traded at a discount to other pure wholesale retailers such as Sysco and Britain’s Booker.
Metro, a sprawling conglomerate, has spent several years restructuring and selling non-core businesses such as its Kaufhof department stores, to focus on its cash-and-carry business and Media-Saturn electronics chain.
“We remain cautious on Metro’s perennial problems. It remains to be seen to what extent the new combined businesses will be able to finally reduce the high exceptional charges and optimise the tax rate,” said Bernstein analyst Bruno Monteyne.
The new food business comprises wholesale stores, which serve hotels, restaurants and independent retailers, along with Real hypermarkets in Germany. Together they had 2015-16 sales of 37 billion euros ($42.4 billion) and operate in 35 countries.
Ceconomy is Europe’s biggest consumer electronics business ahead of Dixons Carphone, running more than 1,000 stores in 15 European countries, with sales of 22 billion euros in 2015/16.
$1 = 0.8734 euros Reporting by Alexander Huebner; Writing by Emma Thomasson; Editing by Victoria Bryan and Maria Sheahan