'Del Boy billionaire’ saves DIY chain Homebase from collapse rescuing 70 UK stores
13 November 2024, 16:23
A discount store owner described as a "Del Boy billionaire" has stepped in to save Homebase, the popular DIY and garden retailer, from the brink of collapse.
Listen to this article
Loading audio...
Earlier today it was revealed that 130 Homebase stores were facing possible closure in a move that marks yet another major setback for the British high street.
However, it's now emerged that Chris Dawson, owner of retail giant The Range, has stepped in to save 70 of the stores - with the fate of 50 still hanging in the balance.
The entrepreneur, said to be worth £2.5bn, was rumoured to be in talks over the 40-year-old DIY brand in a deal thought to be worth £30m.
According to reports, the chain is preparing to appoint corporate restructuring firm Teneo to handle the insolvency process for its UK operations.
The retailer, owned by Hilco Capital since 2018, has struggled to regain financial stability following a tumultuous period under previous ownership.
In August, Sainsbury's agreed to acquire 10 Homebase stores and convert them into supermarkets as part of a deal that could create around 1,000 new jobs.
The buyout will potentially save around 1,600 jobs, with the fate of around 2,000 jobs and 49 stores still uncertain.
Read more: Full list of Wetherspoons pubs closing by end of 2024 - check to see if your local could shut
Hilco initially acquired Homebase for just £1 after the Australian conglomerate Wesfarmers offloaded the chain two years after its ill-fated 2016 takeover, during which it reported losses of £57 million.
The latest developments come as Homebase joins a growing list of high street names, including Carpetright, The Body Shop, Wilko, and Paperchase, all of which have recently succumbed to financial pressures.
Last summer, Hilco began a formal process to sell Homebase, with retail chain The Range among the interested buyers. Despite early negotiations, a deal was not reached. Founded in 1989 by entrepreneur Chris Dawson, The Range has since grown to become one of the UK's fastest-expanding retailers, boasting over 210 stores.
The company recently acquired Wilko’s brand and intellectual property after that chain’s collapse, yet ultimately opted not to proceed with a Homebase purchase.
Homebase’s financial troubles have been widely documented. In 2018, the company went through a Company Voluntary Arrangement (CVA), leading to the closure of over 100 stores and resulting in the loss of 1,500 jobs. Accounts filed with Companies House reveal that the retailer suffered more than £40 million in losses in 2022, though performance reportedly improved somewhat last year.
Amid these ongoing challenges, Homebase managing director Damian McGloughlin warned suppliers in August, admitting the company was trading “behind where we planned to be.”
He said there was an "active sale process" to attract new investors. Talks followed with a range of potential buyers, including B&M European Value Retail and Kingfisher.
However, these discussions ultimately failed to yield a sale, leaving the retailer with limited options to address its financial difficulties.
- More to follow - this is a breaking news story please refresh the page for the latest
