EDEKA may have to pay “dowry” for Marktkauf

According to reports in Financial Times Deutschland, Edeka may have to pay around EUR320 million (USD422.3 million) as a “dowry” to Rewe along with the sale of its loss making DIY subsidiary Marktfauf. At the beginning of January, it was reported that Edeka was offering around EUR60 million (USD79.1 million) while Rewe was demanding around EUR100 million (USD131.9 million). Decisive negotiations are expected in the coming weeks. Preliminary figures for 2006 indicate the operating loss for the DIY division to have increased from around EUR62 million (USD77 million) to approximately EUR77.7 million (USD97.4 million). Edeka is therefore coming under pressure to dispose of Marktkauf. At Rewe, it is understood that while the management favours a takeover of the DIY chain, the supervisory board is reported to have indicated reservations.