Kingfisher plans to open a trial large-scale Woolworths store in Edinburgh in June. Called Big W, it will include homewares, entertainment products and children's clothing as well as extra lines taken from other Kingfisher formats, such as electricals and health and beauty products.
Peacocks, the discount clothing retailer, will provide a range of adult fashions. Burger King will run a fast food outlet at the store.
A further two or three Big Ws are planned, although the company said it would monitor progress before pressing ahead with further expansion.
The Kingfisher chief executive, Sir Geoff Mulcahy, denied he was trying to create a Wal-Mart format in the UK, pointing out that Big W would not sell supermarket groceries.
"Wal-Mart is just one of a number of companies we look at around the world as a way of monitoring best practice," he said.
The comments came as Kingfisher announced a 15.3 per cent rise in underlying profits to pounds 830m in the year to January.
Sir Geoff said 1998 had been a landmark year for the group, capped by the merger of its B&Q do-it-yourself chain with Castorama of France in December. Kingfisher said the deal signalled that it was now a European retail group, with 40 per cent of its sales outside the UK. Two of its divisions - electricals and DIY - are now headquartered in France, Sir Geoff added.
Kingfisher also announced plans to open 100 new stores this year, creating 4,800 new jobs. This includes the group's first store in China, which will be a B&Q in Shanghai. Four branches of B&Q have been opened in Taiwan.
Sir Geoff played down speculation that the company was looking out for a deal in Germany, saying it was concentrating on developing the businesses it had and on integrating Castorama. However, analysts still feel the group would like an electrical business in Germany to add to its Wegert chain.
The full-year group figures only included a one-month contribution from Castorama. B&Q was the best performer with profits up by 16 per cent and like-for-like sales up by over 5 per cent. However, Comet had a tougher time with profits flat and like-for-like sales marginally lower. Same- store sales across the company were up by 4.9 per cent.
The shares closed 17p lower at 793p.