If BJC isn't able to purchase Metro Cash & Carry Vietnam, TCC Holding has indicated it will step in.
TCC Holding will step in to purchase German retailer Metro in Vietnam, taking over from Thailand's Berli Jucker (BJC) if shareholders of the latter still disagree with the deal, BJC has announced.
TCC Holding is in negotiations with Metro AG, seeking agreement on the additional condition in the deal. Under the terms of the original deal, BJC must pay a $776-million guarantee to Metro with a further $776 million required for the sale to be completed. The $1.5 billion total is considered by many to be a financial burden and a high legal risk.
With a 73.7 per cent stake in BJC, TCC Holding needed approval from 75 per cent of BJC's investors to proceed with the original deal between BJC and Metro AG.
The additional condition was blamed for 88.5 per cent of shareholders attending the extra-ordinary meeting voting against the deal, which TCC Holding proposed on January 8.
BJC, which trades most of TCC's consumer goods, hopes to expand its business throughout ASEAN given the slowing demand in Thailand. Vietnam was believed to be an important step for it to develop in regional countries and Metro has already gained a significant foothold in the country's modern grocery market, with a 22 per cent market share.
Despite the difficulties, a BJC representative said that the group still hopes to complete the acquisition in the first half of this year.
- TCC Holding