Kingfisher has agreed to sell a controlling stake in its Chinese B&Q business to Wumei Holdings for £140m.
The retail group had been looking for a “strategic partner” for its business in China in order to focus on the larger and more lucrative European market said newly installed Kingfisher chief Véronique Laury.
B&Q first opened its doors in China in 1999 but found demand for DIY has yet to take off as it has in western markets. Kingfisher made retail losses of £4m in China as sales declined 10.6 per cent to £97m in the third quarter as a result of the country’s slowing property market.
Retail operator Wumei will hold a 70 per cent stake in the B&Q China business, which numbers 39 stores in 17 cities, subject to approval by Chinese regulators. Wumei operates supermarkets and department stores across China, including Wumart, Jingbei Shopping Mall and Merrymart.
Laury 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."