BRITISH plumbing supplies group Wolseley yesterday confirmed it is in talks to sell off its Austrian business OAG, as it looks to streamline the company.
The FTSE 100-listed firm expects to sell the underperforming unit to subsidiaries of Vienna-headquartered peer Frauenthal Holding for around £25m. Wolseley said the transaction would generate a small loss on completion.
“This disposal is in line with our resource allocation strategy of focusing on our core operations where we can build significant scale and generate attractive returns,” said chief executive Ian Meakins.
The company, which operates the Plumb Center and Ferguson chains in Britain, said OAG generated revenue of £239m in the last financial year and trading profit of £2m.
Closing is subject to approval from the Austrian antitrust authority.
In March, Wolseley posted a 63.7 per cent rise in half-year profit to £316m due to strong trading in the UK and US.
But it warned of continued headwinds in continental Europe “requiring strong action on gross margins and costs to protect profitability”. Like-for-like revenues in central Europe fell 2.6 per cent in the period.
Wolseley’s shares closed 0.5 per cent higher yesterday.