Kingfisher plc announces binding agreement to sell controlling stake in its B&Q China business.
Kingfisher plc, Europe‘s leading home improvement retailer, today announces a binding agreement to sell a controlling 70% stake in its B&Q China business to Wumei Holdings Inc for a total cash consideration of £140 million. The agreement follows Kingfisher‘s previous announcement of its plans to look for a strategic partner to help develop its B&Q business in China.
Kingfisher plc is Europe‘s leading home improvement retail group and the third largest in the world, with 1,176 stores in 11 countries in Europe and Asia. Its main retail brands are B&Q, Castorama, Brico DÃ©pÃ´t and Screwfix. Kingfisher also operates the KoÃ§taÅŸ brand, a 50% joint venture in Turkey with the KoÃ§ Group.
B&Q China opened its first store in China in 1999 and now has 39 stores in the market, with over 3,000 employees.
The transaction is conditional on MOFCOM (Chinese Ministry of Commerce) approval and, if approved, is expected to close during the first half of next year.
Commenting on the announcement, VÃ©ronique Laury, Kingfisher‘s Group Chief Executive, said:
“I am delighted to have found a strong retail partner who will help us to release the financial value of our business in China. This will enable us to focus our financial resources and management talent on the large and attractive European home improvement market.”
Wumei Holdings Inc is one of China‘s leading retail chain store operators. It was founded in 1994 and is headquartered in Beijing. The retail network comprises around 650 supermarkets and 10 department stores in northern, eastern and western China with a sales area of over 1.4m sqm. It is the controlling shareholder of Hong Kong listed Wumart Stores Inc and Shanghai listed Xinhua Department Store. Its brands include Wumart, Jingbei Shopping Mall, Merrymart, Xinhua Department Store, Zhejiang Gongxiao and Laodafang.
UBS Investment Bank acted as financial adviser to Kingfisher on the transaction and Hogan Lovells acted as legal adviser.