Shares in Britain's biggest furniture retailer, MFI, jumped yesterday after it said it had received several bid approaches for all or part of the 200-strong chain of stores. Shares closed down nearly 8 percent higher, up 18.75p, at 119p.
Potential bidders expected to include rival retailers such as GUS, which has Argos and Homebase, and several private equity firms that have been around a group of losers for some time. The Swedish furniture retailer Nobia, which snapped MFI Hygena Cuisines French retail business for £ 92m in February, is also tipped as a potential buyer.
Analysts said the groups, which also has business builders merchants Howden and Sofa Workshop chain, will be lucky if it managed to offload its loss-making retail arm to the hand without the money the buyer. Richard Ratner, at Seymour Pierce, said: "We doubt if anyone will pay for the UK retail arm, and then can the question of a 'reverse premium' to take the business and pension obligations."
Under the law the new pension, MFIs still be responsible for the pension for six years after the sale if the buyer had to go "pop", he said. MFI burdened with pension fund deficit of £ 297m.
MFI slipped into the red 110 pounds last year, from £ 20m profit in the year 2004. The new chief executive, Matthew Ingle, recently described a big restructuring for retailers threw back to black. His predecessor, John Hancock, was fired last October after leading the company's fortunes with the collapse of four profit warnings. The cycle plan will cost £ 46m this year, plus £ 35m asset write-off. Around 1470 jobs will go with the closure of two factories and at least 11 MFI stores.
Mark Charnock at Investec said the chain store sales would save MFIs need to do an expensive restructuring. Will leave the group with better-performing 340-strong Howden chain, such as Sofa Workshop is also being sold.
Chairman, Ian Peacock, who plans to come down in the next 12 months after six years in the post, also provides trading update yesterday at the annual meeting in London. Command in the retail arm declined 19 percent so far this year, partly because the strategy to exit unprofitable sales, and sales are expected to have fallen even more than an order.
Howden sales rose 12 percent overall and by 8 percent in like-for-like basis. However, since June last year additional promotion will not be repeated this year by eating into the profit margin, total sales expected to be flat this year and like-for-like sales down. But the absence of promotion to push margins up. news.independent.co.uk
Potential bidders expected to include rival retailers such as GUS, which has Argos and Homebase, and several private equity firms that have been around a group of losers for some time. The Swedish furniture retailer Nobia, which snapped MFI Hygena Cuisines French retail business for £ 92m in February, is also tipped as a potential buyer.
Analysts said the groups, which also has business builders merchants Howden and Sofa Workshop chain, will be lucky if it managed to offload its loss-making retail arm to the hand without the money the buyer. Richard Ratner, at Seymour Pierce, said: "We doubt if anyone will pay for the UK retail arm, and then can the question of a 'reverse premium' to take the business and pension obligations."
Under the law the new pension, MFIs still be responsible for the pension for six years after the sale if the buyer had to go "pop", he said. MFI burdened with pension fund deficit of £ 297m.
MFI slipped into the red 110 pounds last year, from £ 20m profit in the year 2004. The new chief executive, Matthew Ingle, recently described a big restructuring for retailers threw back to black. His predecessor, John Hancock, was fired last October after leading the company's fortunes with the collapse of four profit warnings. The cycle plan will cost £ 46m this year, plus £ 35m asset write-off. Around 1470 jobs will go with the closure of two factories and at least 11 MFI stores.
Mark Charnock at Investec said the chain store sales would save MFIs need to do an expensive restructuring. Will leave the group with better-performing 340-strong Howden chain, such as Sofa Workshop is also being sold.
Chairman, Ian Peacock, who plans to come down in the next 12 months after six years in the post, also provides trading update yesterday at the annual meeting in London. Command in the retail arm declined 19 percent so far this year, partly because the strategy to exit unprofitable sales, and sales are expected to have fallen even more than an order.
Howden sales rose 12 percent overall and by 8 percent in like-for-like basis. However, since June last year additional promotion will not be repeated this year by eating into the profit margin, total sales expected to be flat this year and like-for-like sales down. But the absence of promotion to push margins up. news.independent.co.uk
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