Once a sprawling retail conglomerate, Metro has in recent years been restructuring to focus on its core cash-and-carry business, selling off the Kaufhof department stores and then splitting from consumer electronics group Ceconomy.
It has long sought to shed its Real hypermarkets chain, which has annual sales of more than 7 billion euros (6.24 billion pounds) but has struggled for years in a fiercely competitive German market, dominated by discounters Aldi and Lidl.
Metro entered exclusives talks with Redos in May and initially agreed to complete talks by the end of July but then extended that deadline to September.
The timeline was delayed to give a rival suitor, a consortium comprising property investor X+Bricks and SCP Group, the chance of making a bid for Real.
Redos aims to buy Real as a going concern but wants to sell some stores to competitors, with German chains, such as Edeka, Rewe and Kaufland, seen as possible buyers.
The investment vehicle of Czech businessman Daniel Kretinsky, who failed last month in a bid to buy Metro for 5.8 billion euros , has criticised Metro's plan to sell Real to Redos, saying the price was too low.
Metro declined to comment, while Redos was not immediately available for comment.
(Reporting by Matthias Inverardi; Writing by Arno Schuetze; Editing by Alexandra Hudson)