Dixons pays £58m to have Pixmania taken off its hands
Thursday 05 September 2013
Dixons today shed its loss-making French
online business, handing the buyer tens of millions of euros to take it off its
Pixmania is being bought by German industrial conglomerate Mutares and Dixons, which runs Currys and PC World, will pump 69 million (£58 million) into the business to fund it going forward.
The news was greeted with enthusiasm and relief on the stock market with Dixons Retail shares jumping more than 8%, 3.7p at 48p.
The shares have risen by more than 150% in the past year.
At the same time Dixons is also selling its loss-making Turkish chain of 32 ElectroWorld shops to local retailer Bimeks for £2 million.
The deals mark the latest move by chief executive Sebastian James, who took the helm just over 18 months ago. He said: “I am a passionate believer that Dixons succeeds where we offer our customers a fully integrated multi-channel proposition and where we are the market leader. We were not that in France and have been looking at a way of getting a result for some time.”
Dixons also reported 4% growth across its ongoing businesses in the first quarter to end-July.
This included a 6% rise in the UK, 5% in northern Europe and a 12% fall in southern Europe, where sales of air conditioning, in particular, were hit by a cooler than normal summer.
James, who has also overseen the sales of a Norwegian business and Equanet as well as closing the Dixons.co.uk website, said: “We have had an encouraging start to the year given that we had a particularly strong start to the previous year. Margins have held up reasonably well.”
Dixons paid £185 million for Pixmania in 2006 and bought out the remaining minority for just £8 million last year. The business lost £31 million on sales of £357 million last year and in the latest quarter its sales fell by a further 28%.
James said: “Pixmania needs a different kind of entrepreneurial flair, which is why we have agreed to inject cash into it and to back its management under their new owners.”
He said he remained cautious about the state of the electrical retail market and added: “But with this good start, I am excited about the rest of the year and about the future for a successful and simplified group.”
The Pixmania deal is conditional on it successfully concluding negotiations with its workforce in France over the transfer of jobs. Dixons wrote down the value of the business by £135 million this year.
- 1 The difference between a migrant and refugee, in one sentence
- 2 Miley Cyrus calls out hypocrisy of women’s nipples being taboo
- 3 Celebrity Big Brother 2015: Tila Tequila kicked off show after 'describing Hitler as a good man'
- 4 iPhone 5c to be discontinued, no iPhone 6c to replace it
- 5 Blood Moon and Supermoon: September to bring brightest – and dimmest – full Moon of the year on same night
The difference between a migrant and refugee, in one sentence
Spain accused of 'provocation' after letting Russian submarine refuel off Gibraltar
Allonautilus scrobiculatus: World's 'rarest' creature spotted for only the third time ever
Miley Cyrus calls out hypocrisy of women’s nipples being taboo
Celebrity Big Brother 2015: Tila Tequila kicked off show after 'describing Hitler as a good man'
Climate change: 2015 will be the hottest year on record 'by a mile', experts say
Labour leadership: Jeremy Corbyn accused of 'deluding' young supporters with 'claptrap'
'Women only' train carriages: Jeremy Corbyn unveils radical move to tackle public harassment
Black holes are a passage to another universe, says Stephen Hawking
Iain Duncan Smith 'should resign over disability benefit death figures', says Jeremy Corbyn
Iain Duncan Smith calls for urgent ESA overhaul as part of drive to cut down welfare costs
iJobs Money & Business
£25000 - £30000 per annum: Recruitment Genius: From modest beginnings the comp...
£35000 - £40000 per annum: Recruitment Genius: From modest beginnings the comp...
£15000 - £65000 per annum: Recruitment Genius: This is an exciting opportunity...
£18000 - £20000 per annum: Recruitment Genius: This is a fantastic opportunity...