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Comet electrical stores sold by Kesa for £2 | Comet electrical stores sold by Kesa for £2 |
(about 6 hours later) | |
Anglo-French electrical goods retailer Kesa has announced plans to sell off its troubled UK-based Comet stores to a private equity firm for just £2. | Anglo-French electrical goods retailer Kesa has announced plans to sell off its troubled UK-based Comet stores to a private equity firm for just £2. |
The buyer is a group of companies under the name "Hailey" advised by retailer turnaround specialists OpCapita. | The buyer is a group of companies under the name "Hailey" advised by retailer turnaround specialists OpCapita. |
Kesa said it would invest £50m itself into the new holding company, and would retain liability for the Comet employees' final salary pension scheme. | Kesa said it would invest £50m itself into the new holding company, and would retain liability for the Comet employees' final salary pension scheme. |
Kesa added it would benefit from any subsequent onward sale of the chain. | Kesa added it would benefit from any subsequent onward sale of the chain. |
However, it would only do so if the resale price were greater than £70m. | However, it would only do so if the resale price were greater than £70m. |
The investment vehicle, under OpCapita's guidance, has also attracted £30m of outside private equity investment and a £40m loan facility. | The investment vehicle, under OpCapita's guidance, has also attracted £30m of outside private equity investment and a £40m loan facility. |
Responsibility for warranties and servicing will remain with Comet, but a 73m euro (£62m) fund to support these will be transferred by Kesa to the UK company. | Responsibility for warranties and servicing will remain with Comet, but a 73m euro (£62m) fund to support these will be transferred by Kesa to the UK company. |
The buyers have promised to keep Comet as a going concern for at least 18 months. | The buyers have promised to keep Comet as a going concern for at least 18 months. |
Revenues at the loss-making Comet electrical stores fell 22% over the summer, prompting Kesa's chief executive to say that a decision would be made by Christmas about whether to dispose of Comet. | Revenues at the loss-making Comet electrical stores fell 22% over the summer, prompting Kesa's chief executive to say that a decision would be made by Christmas about whether to dispose of Comet. |
The sale is expected to involve the closure of some of Comet's 250 stores. | The sale is expected to involve the closure of some of Comet's 250 stores. |
The parent company has already confirmed the closure of 17 Comet stores and "right-sizing" of a further nine in the next three years. | The parent company has already confirmed the closure of 17 Comet stores and "right-sizing" of a further nine in the next three years. |
One company that might buy some of the closing stores is Dixons. | |
"I'm sure there will be a few of those stores which might be of interest to us, so we'll have a close look," Dixons chief executive John Browett told BBC News. | |
Markets took the news well for most of the day, but then fell in late trading to close down by 2.75%. | Markets took the news well for most of the day, but then fell in late trading to close down by 2.75%. |
The company is expected to delist from London following the Comet sale, leaving it with a listing in Paris only. | The company is expected to delist from London following the Comet sale, leaving it with a listing in Paris only. |