Metro Holdings to co-invest in Chinese properties

Mainboard-listed Metro Holdings has set up a firm with a private equity real estate fund to co-invest in Chinese properties owned by retailer Tesco.

The newly set up firm, Choice Bright Holdings, will invest about US$49 million in return for a 50 per cent stake in three assets in China under Tesco.

They are Tesco Chelsea, Tesco Tianying and Tesco Shenyang Beihai.

Metro will contribute about one-fifth of the investment figure, and will hold a 10.7 per cent effective interest of Choice Bright.

The remaining interest will be held by the private equity fund, which will contribute the rest.

Metro said the investment is in its ordinary course of property development business in China, and is in line with the company’s wider plans to tap the Chinese market.

The Metro Group’s commitment will initially be funded primarily from internal cash sources.

The investment is not expected to have any significant effect on the consolidated net tangible assets per share and consolidated earnings per share of the Metro Group for the current financial year ending March 31, 2011.

Tesco is one of the world’s leading retailers with over 4,800 stores worldwide.

Source : Channel NewsAsia – 28 Feb 2011

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