Future of small Norweb stores in doubt

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The Independent Online
Plans by Kingfisher, the Woolworths and B&Q retail group, to buy the electricity stores of Norweb are unlikely to include the group's 60 high- street outlets, it emerged last night.

It is understood that Kingfisher will only be interested in Norweb's 70 out-of-town stores, leaving the fate of the smaller high-street shops in doubt.

It is expected that these could be shut down, in line with a long-established trend in the high-street end of the retail electrical equipment sector.

If a deal is completed, Kingfisher will rebrand the stores under its Comet name, which is under-represented out of town.

Kingfisher declined to comment on any possible deal. Norweb, owned by United Utilities, put the chain up for sale earlier this year.

Though many of the privatised utilities have incurred huge losses in their retailing ventures, Norweb's operation recorded profits of pounds 6m on sales of pounds 130m last year.

Comet has 223 stores, which have been recovering after a disastrous 1995 when the chain recorded a pounds 2m operating loss and a 9 per cent slump in like- for-like sales.

Last year Comet made pounds 3m profits with like-for-like sales ahead by 10 per cent. It has increased its market share from 9.6 per cent to 10.1 per cent. Like Dixons, which includes the Curry's chain, Comet has benefited from the surge in sales of multi-media PCs, which were introduced to almost 100 Comet outlets during the past year.

If Kingfisher did snap up the Norweb sites, it would continue a major consolidation of the electrical retail sector.

Rumbelows and Escom have closed, while a number of the chains owned by the utilities have either been sold or closed. Scottish Power is now one of the few utilities still expanding in the sector.

It has become increasingly difficult for smaller high-street stores to compete against the huge out-of-town sites.

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