In for $705m, out for £1: Wesfarmers abandons UK Bunnings disaster
Wesfarmers is abandoning its disastrous attempt to expand its Bunnings Warehouse chain into the United Kingdom and Ireland by selling the business for a single British pound.
The conglomerate said on Friday it will sell its British hardware business, including the Homebase chain it bought in 2016 and 24 pilot Bunnings stores it had opened in the country, to restructuring firm Hilco Capital. It expects to book a loss of between £200 million to £230 million ($325 million to $375 million) in its full-year results from the exit.
Wesfarmers had hoped to replicate the success of its earnings powerhouse hardware chain in the UK and Ireland, but instead ran up heavy losses after misreading the market and alienating Homebase’s existing customers.
The company paid $705 million for Homebase in 2016, but wrote down the value of the venture by $1 billion in February. Sydney Morning Herald – Read more…