B&Q owner Kingfisher sells off struggling Romanian division in £58m deal

Kingfisher has confirmed that it will sell its Brico Dépôt Romania operation for £58m following the decision to put the business up for sale last year.

The deal includes the entire portfolio of 31 Brico Dépôt stores across 24 Romanian cities, encompassing distribution operations and the head office in Bucharest, with completion expected in the first half of the next fiscal year, as reported by City AM.

Kingfisher's CEO Thierry Garnier has noted that this sale enables "greater strategic focus on markets and growth initiatives where we are most strongly positioned to deliver attractive returns and create shareholder value". The firm emphasised that there would be "no impact" on the Brico Dépôt brands operating in France, Spain, and Portugal.

The divestment comes as the owner of B&Q and Somerset-based Screwfix seeks to streamline its operations after a difficult financial year, during which time they lowered their profit forecast and experienced an approximate eleven per cent decrease in share price over the past month. However, shares have seen an upswing in gains by nearly seven per cent since the start of the year.

The Romanian division, which was ushered into the market in 2013 through the acquisition of 15 Bricostore locations, reported sales of £269m—which is about 2.1 per cent of Kingfisher’s total sales—along with a retail loss of £18m and a free cash outflow of £17m last financial year. The buyers, Altex Romania, are a prominent electro-IT retail chain in the country.

Dan Ostahie, CEO of Altex Romania, stated: "Altex Romania is confident in the future of Brico Dépôt and is determined to continue serving the community with high-quality products and services."