MTTRY Ceconomy AG (PK)

   By Alberto Delclaux 
 

Shares in German retailer Ceconomy AG (CEC.XE) rose Friday after news of a deal that would allow its Media-Saturn subsidiary to unload the company's loss-making Russian MediaMarkt to Safmar Group.

Ceconomy said late Thursday it was in advanced discussions with Safmar regarding a possible sale of its Russian MediaMarkt business, a transaction it said would eliminate Media-Saturn's operating losses in the region. In the deal, Media-Saturn would pay around 258 million euros ($303.5 million) for a 15% stake in Safmar's M.Video (MVID.MZ) business, a Russian consumer-electronics retailer.

Analysts at Baader Helvea welcomed the deal and added Ceconomy to its "top pick" list.

"The deal would give Ceconomy the opportunity to get rid of its...loss-making Russian operations," at a high though not unrealistic price, the brokerage said.

It could also be a smart move in the long run, the analysts said, given the long-term potential of the Russian market.

At 0824 GMT, shares were up 3.1% at EUR8.54.

Ceconomy said the transaction would likely result in a three-digit-million-euro hit to its 2017-2018 financial result. Earlier this year, Ceconomy said it was in talks about a potential disposal in Russia.

Regarding the price, Baader Helvea analysts estimate EUR150 million would pay for the M.Video stake and EUR108 million would cover the cost of unloading the loss-making operations.

Write to Alberto Delclaux at alberto.delclaux@dowjones.com

(END) Dow Jones Newswires

June 15, 2018 04:53 ET (08:53 GMT)

Ceconomy (PK) (USOTC:MTTRY)
Graphique Historique de l'Action
De Juin 2024 à Juil 2024

Ceconomy (PK) (USOTC:MTTRY)
Graphique Historique de l'Action
De Juil 2023 à Juil 2024