By Marcus Leach
Kesa Electricals plc has announced today (Wednesday) that it has entered into an agreement with Hailey Holdings Ltd and Hailey Acquisitions Limited, to sell to them Comet Group plc, its subsidiaries and Triptych Insurance N.V. for an aggregate consideration of £2.
The sale is subject to approval of the disposal by the Company's ordinary shareholders. In addition, there will be an investment by the Group of £50 million into Hailey 2 LP. The Company will retain the liability for the Comet Defined Benefit Pension Scheme.
“In June 2011, the Board decided to explore strategic alternatives for Comet in parallel with implementing the turnaround plan focused on restoring profitability at Comet over the medium term," David Newlands, Chairman of Kesa Electricals plc, said.
"Having concluded the review of its strategic alternatives, the Board believes that a disposal on the terms agreed with the Purchasers is in the best interests of Ordinary Shareholders and delivers a more certain outcome than continuing with the turnaround plan.
"Whilst good progress has been made against the turnaround plan’s strategic objectives, in reaching its view the Board took into account: the ongoing negative impact of Comet on the financial position of the group; the significant challenge involved in achieving an acceptable level of profitability at Comet over the long term given the specific competitive nature of the UK market; and the substantial costs involved if the turnaround plan proved to be unsuccessful."
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