UPDATE 2-Haniel to cut Metro, Celesio stakes to reduce debt

Tue Nov 27, 2012 1:20pm EST

Related Topics

* Haniel to cut stakes to bring net debt below 2 bln euros

* Haniel to sell 4.24 stake in Metro within 18 months

* Celesio stake to fall to 50.01 percent (Adds Metro, Celesio comments, context)

FRANKFURT, Nov 27 (Reuters) - Family-owned conglomerate Haniel said it would sell down stakes in retailer Metro and drugs distributor Celesio to cut its debt to below 2 billion euros ($2.59 billion).

"This is a decisive step for Haniel on its way to significantly reducing our net debt position at holding level," Chief Executive Stephan Gemkow said in a statement. Haniel has about 2.4 billion euros of debt.

Haniel's board approved the sale of about 13.7 million shares in Metro, equivalent to a 4.24 percent stake in the company, to reduce its holding to 30.01 percent within the next 18 months, Haniel said.

Metro - owned 50.01 percent by the Haniel and Schmidt-Ruthenbeck families - has struggled to slim down to adjust to an economic slowdown in Europe and dropped out of Germany's blue-chip DAX index in September.

Standard & Poor's cut Metro's earnings last month on fears that profits would continue to weaken.

Gemkow said Metro and Celesio would remain long-term investments in the Haniel portfolio.

Haniel said it would place about 7.9 million shares in Celesio in the near term, by way of an accelerated bookbuilding to institutional investors, to cut its stake to 50.01 percent.

Celesio shares will be offered at between 12.20 euros and 12.50 euros a share, a source familiar with the matter said on Tuesday.

Haniel said it had agreed not to engage in any further stake sales or transactions which could lead to a further reduction in its Celesio holding in the next six months. The Celesio placement is managed by Deutsche Bank AG.

Celesio said it welcomed the fact that Haniel would remain as an anchor investor. Metro declined to comment.

An additional 150 million euros will be raised from the sale of other non-strategic assets, Haniel said. ($1 = 0.7733 euros) (Reporting by Edward Taylor, Alexander Huebner, Matthias Inverardi; and Frank Siebelt; Editing by Maria Sheahan and Helen Massy-Beresford)

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