Hon Hai Precision Industry Co (鴻海精密), the world’s largest contract electronics maker, expressed regret over its German partner’s plan to withdraw China’s retail market.
Media-Saturn, a consumer electronics retail business arm of Germany’s largest retailer Metro AG, has decided to withdraw from the Chinese market after a two-year period of trial operations in China expired at the end of last year.
The joint computer, communications and consumer electronics product retail chain set up by Media-Saturn and Hon Hai in November 2010 –– called Media Markt –– has seven outlets in the Shanghai area.
Hon Hai, which owns a 25 percent stake in the Media Markt chain, said Media-Saturn made a unilateral announcement to exit China and it expressed regret over the decision. It has promised to protect the interests of all of Media Markt’s affected customers, employees, shareholders and other related parties, the Taiwan-based company said.
However, it did not disclose details of how it plans to deal with Media-Saturn’s withdrawal.
The way forward will be determined together with its Taiwanese partner, Metro added in a statement.
According to a Bloomberg report, the exit from China’s retail market will save the German company an estimated 40 million euros (US$47.90 million) in losses this year.
“After carefully analyzing all alternatives, we have decided not to continue our business activities,” Metro chairman Olaf Koch said in a statement on the company’s Web site.
“In order to keep Metro Group on target for success, it is essential for us to concentrate on those business units and markets where we can clearly sharpen our profile and build up a strong market position,” Koch said.
In addition to the Media Markt joint business, Hon Hai owns other retail businesses in China, including CyberMart (賽博數碼), also a 3C product distribution chain.