KESA Electricals was yesterday forced to pay a £50m dowry to offload Comet, its struggling British electricals chain.
OpCapita, the restructuring specialist that is buying Comet, paid a headline consideration of just £2 for the loss-making chain.
But in reality, Kesa – which is also taking on Comet’s €45.9m pension deficit – is paying a great deal to get rid of the business.
“We had to pay £50m to get the business away. We will write it off as having no value,” chairman David Newlands said yesterday.
However, Kesa investors will be relieved the firm has severed itself from Comet’s annual rent bill of €90m. Activist fund Knight Vinke, Kesa’s biggest shareholder, praised management for offloading Comet in a “tough UK retail environment”.
The fire sale of Comet underlines the torrid conditions for retailers trying to sell gadgets, TVs and computers on the high street.
Kesa, which owns Darty in France, is the second big name in consumer electricals to quit the UK this week.
On Monday, Carphone Warehouse and America’s Best Buy announced they were pulling the plug on their joint venture and shuttering all 11 of their British stores.
It is not the first time that OpCapital, which previously operated as Merchant Equity Partners, has bought a business from Kesa. In 2008, it was part of a consortium that bought BUT, Kesa’s French furniture chain, for €550m.
Merchant Equity also saved the now-defunct furniture retailer MFI from collapse in 2006, before selling it to management in 2008.
Like-for-like sales at Comet, which lost nearly £9m last year, were down by almost 20 per cent in Kesa’s first half.