MUEHLHEIM AN DER RUHR, Germany, July 14 (Reuters) - German retailer Tengelmann expects to exit its holding in Great Atlantic & Pacific Tea (A&P) GAPTQ.PK when the U.S. grocery store chain emerges from bankruptcy protection.
“We hope that A&P can be led out of its insolvency. But we do not believe that we will be significant shareholders after the process ends,” Tengelmann Chief Executive Karl-Erivan Haub told reporters on Thursday.
A&P, once the largest U.S. grocer, filed for bankruptcy protection in December as it ran low on cash and was squeezed by discounters like Costco Wholesale Corp (COST.O), Wal-Mart Stores Inc (WMT.N) and Target Corp (TGT.N).
“A&P is currently in freefall,” Tengelmann’s Chief Financial Officer Jens-Juergen Boeckel said.
Tengelmann, which owns about 38 percent of A&P, said last year it expected the company to be combined with another retailer in the long term. It has now fully written off the value of its stake in A&P.
Haub also said on Thursday that Tengelmann’s home improvement store chain OBI would not take over peer Praktiker PRAG.DE, in part or in whole.
Praktiker declined to comment on the matter. (Reporting by Matthias Inverardi; Writing by Maria Sheahan)