Metcash Ltd, Australia's largest independent grocery supplier, said it will sell its auto parts unit to larger Burson Group Ltd for A$275 million ($212 million), scrapping a planned initial public offering amid uncertain conditions.
In April, Metcash said it would sell its auto parts business in an IPO and use the proceeds to pay off debt. In a statement on Monday, the company said that since it announced the IPO, it had received an offer from No.1 non-dealership car parts supplier Burson.
The decision to scrap a share market listing in favour of a sale is the fourth IPO cancelled in Australia and New Zealand in the past week amid an increasingly volatile share market.
"Through discussions with Burson, it became clear that the parties could reach an agreement which represented both attractive value for shareholders and certainty of transaction completion," Metcash Chief Executive Officer Ian Morrice said in the statement.