Kingfisher to sell struggling Romanian business for £58m
Share:
Kingfisher has agreed to offload its loss-making business in Romania to a local electronics retailer. Screwfix's parent company revealed plans to sell the division, including its 31 outlets, distribution operations and head office in Bucharest, to Altex Romania in a €70million (£58million) deal.
It expects to complete the sale sometime in the first six months of the next financial year, dependent on regulatory approval. Kingfisher first entered the Romanian market in 2013 after buying Bricostore Romania from French retail firm Group Bresson. The B&Q and Castorama owner later expanded its store network in the country with the £19million acquisition of home improvement business Praktiker Romania in 2017.
However, Kingfisher's Romanian operations have struggled to become profitable over recent years due to subdued demand and Covid-related restrictions. Disposal: Screwfix owner Kingfisher has agreed to offload its loss-making business in Romania to a local electronics retailer.
In the financial year covering the 12 months ending January, the division posted an £18million retail loss and £17million in free cash outflow. While it did contribute £269million in turnover, this represented only 2.1 per cent of Kingfisher's total annual revenues.
Dan Ostahie, chief executive of Altex Romania, said the takeover 'marks a significant milestone for all parties involved, and this first step opens up new horizons for growth and opportunities in the DIY market in Romania. 'Our primary goal is to continue growing while delivering quality services with the customer at the centre of our focus.'.
