First Indonesian cash & carry wholesale centre to be opened in 2012

10 June 2011

METRO GROUP joins forces with Sintesa Group to accelerate expansion into Indonesian market

METRO GROUP announced on the occasion of the World Economic Summit on East Asia in Jakarta that it is joining forces with the Indonesian investment holding Sintesa Group to facilitate the market entry of its cash & carry business into Southeast Asia’s largest economy. The first wholesale centre is scheduled to open in 2012 in Jakarta. "With Sintesa Group we found a highly respected joint venture partner. Sintesa will contribute its expertise and knowledge of the local market and together we will push our expansion across Indonesia", emphasised Frans Muller, Member of the Management Board of METRO GROUP and the responsible CEO of Metro Cash & Carry for the Asian region.

"Indonesia offers a huge potential for our wholesale concept", explained Bunny Khurana, Managing Director of Metro Cash & Carry's Indonesian business. "There is a growing demand from businesses like restaurants, caterers and small retailers - our potential core customers - for a reliable supply source of high quality goods. With our unique business-to-business concept we offer them everything they need to run their business under one roof, thus enabling them to participate into a modern distribution infrastructure that will help them to further grow in the increasingly challenging competitive environment." Shinta Widjaja Kamdani, Managing Director of the Sintesa Group adds: "With the prospect of healthy economic growth and an improved investment climate in Indonesia, Metro's entry into the Indonesian market place is well timed. I am confident it will stimulate and accelerate growth in the wholesale and distribution market and I am looking forward making this partnership a tremendous success."

If all pre-requisites, like the securing of all necessary licenses and land plots, are met and if the overall economic environment in Asia stays stable, Metro Cash & Carry sees a potential of more than 20 wholesale centres in Indonesia in the medium-term, thus creating over 4,000 jobs. Each wholesale centre is an investment of 10 to 15 million Euro for land and building. The company plans to open its first Indonesian outlet in 2012 in Jakarta. As the brand names "Metro" and "Makro" - under which Metro normally runs its wholesale business - are already being used in Indonesia, the company is currently in the process of finding a local brand name. Indonesia is due to become the 34th country where METRO GROUP is present and the 31st member in Metro Cash & Carry's international country portfolio.

The development of Metro Cash & Carry's wholesale business and that of the local economy generally goes hand in hand. Up to 90 percent of the assortment on offer is sourced locally. "We will heavily invest in training suppliers, like farmers and local producers, to apply international quality standards and sustainable and efficient production methods", said Khurana. "Thus we are able to offer our customers a better quality at a better price and enable farmers to earn more money and explore export opportunities to our network in 34 countries." Furthermore the company will set up a training centre for the local workforce to learn modern wholesale. "3,500 people will be trained in the first 3 years alone. This way we also contribute to increase the capability in the trade and service sector in Indonesia in general".

As the most international sales division within METRO GROUP, Metro Cash & Carry will introduce its unique B2B self-service wholesale business concept into the Indonesian market and serve local professional customers such as hotels, restaurants, caterers, cafés, small grocers and other companies, service providers and institutions. Over the past 15 years, Metro Cash & Carry has successfully established its network of around 80 outlets in five Asian countries, namely, China, India, Japan, Vietnam and Pakistan.

METRO GROUP is one of the largest and most international trading companies. In 2010 the Group reached sales of around € 67 billion. The company has a headcount of around 280,000 employees and operates more than 2,100 stores in 33 countries. The Group's performance is based on the strength of its sales brands which operate independently in their respective market segment: Metro/Makro Cash & Carry – the international leader in self-service wholesale, Real hypermarkets, Media Markt and Saturn – European market leader in consumer electronics retailing, and Galeria Kaufhof department stores.

The Sintesa Group was founded in 1919 and has grown into an investment holding with shareholder interests in 17 subsidiaries. The Group's principle activities cover four main sectors; Property & Hotels, Consumer Products, Industrial Products and Energy. Two of the 17 subsidiaries, PT Tigaraksa Satria, Tbk and PT Tira Austenite, Tbk, are listed on the Jakarta Stock Exchanges. With over 4,000 employees, the Group achieved an annual revenue of more than US$ 700 M in 2010 and has partnerships with more than 20 Indonesian and foreign business groups. The Sintesa Group's focus and success is based on leveraging local understanding of the Indonesian market place, investment opportunities and regulatory environment, with strong established international companies and brands that would like to enter Indonesia.