German retailer Metro AG is scouting for a partner to sell its stake in its Indian subsidiary Metro Cash & Carry India, according to a source.

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The parent company after reviewing the progress of its Indian unit is now looking for strategic external alliances for profitable growth of the business, said the industry source.

"This is at the discussion stage which has happened," he said, adding some discussion with the bankers has happened regarding it.

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According to a media report, several leading companies operating in the online and offline business-to-business (B2B) and business-to-consumer (B2C) retail space have been approached, including Amazon, Thailand's Charoen Pokphand (CP) Group, Reliance Retail, Avenue Supermarts (D-Mart), Tata Group, Lulu Group, and PE fund Samara Capital.

The Indian business needs more investments to expand and add more stores in its network and attain a scale, he added.

When contacted a Metro AG spokesperson said the company is reviewing the strategic options. "Metro India is a growing business in a market with enormous potential for wholesale.

We are reviewing strategic options with potential partners to enhance Metro's existing wholesale capabilities and accelerate the business development in India. Please understand we will not comment on rumours or speculations in the media, said Metro AG Senior Vice President Corporate Communications Gerd Koslowski."

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Metro AG operates in 34 countries and generated sales of 25.6 billion euros in the financial year 2019-20. It entered the Indian market in 2003. Metro Cash & Carry India currently operates 31 stores in the country under the brand Metro Wholesale.

It operates six stores in Bangalore, four in Hyderabad, two each in Mumbai and Delhi, and one each in Kolkata, Jaipur, Jalandhar, Zirakpur, Amritsar, Ahmedabad, Surat, Indore, Lucknow, Meerut, Nasik, Ghaziabad, Tumakuru, Vijayawada, Visakhapatnam, Guntur and Hubballi.

When asked about the development Metro India's spokesperson said the India business is doing very well and has been profitable since 2018.

"Metro India business is doing very well and has been profitable since 2018; now continuously four years in a row. We have seen a big jump of 57 percent in our EBITDA for FY21 vs FY20. Our e-commerce business in FY21 grew by 5.7x vs the previous year and we have successfully opened three new stores in India in the last 9 months," he added.

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