Focus Do It All emerges as Great Mills' most likely buyer

Focus Do It All has emerged as the most likely buyer for the Great Mills do-it-yourself chain, which was in effect put up for sale last week by its parent company RMC, the cement group.

Focus Do It All has emerged as the most likely buyer for the Great Mills do-it-yourself chain, which was in effect put up for sale last week by its parent company RMC, the cement group.

It is understood Focus has already held exploratory talks with RMC about Great Mills less than two months after its £385m hostile bid for rival Wickes was rejected. It values Great Mills at about £250m, compared with RMC's valuation of around £300m.

Focus sees Great Mills' stronghold in the South-west of England as a perfect fit with its own base in the North-west and Midlands.

With both chains operating at the lighter end of the DIY market the product compatibility is also far greater than with Wickes, which has historically targeted the heavier end of the market.

Focus declined to comment on its interest. But the company, which is backed by Duke Street Capital, argued strongly in favour of sector consolidation during its bid for Wickes. Combining Focus with Great Mills would give the company around 7 per cent of the UK DIY market, putting it third behind Kingfisher's B&Q and Sainsbury's Homebase. Wickes itself is also likely to be interested in Great Mills. Wickes recognised the case for greater scale during the Focus bid though it may struggle to raise the necessary finance.

There could be a long list of other potential buyers. Kingfisher would almost certainly look at Great Mills as a way of stretching B&Q's market leading position. It could also turn some stores into branches of Comet. Home Depot, the US giant, has long been rumoured to be looking for a foothold in the UK while financial buyers, builders' merchants and trade buyers from continental Europe may also be interested.

However, one industry expert said: "Great Mills is a well run, profitable business, but there has been three years of speculation over it being for sale. We will have to wait and see if this is serious."

RMC declined to comment on any talks. Speculation over the sale of Great Mills was fuelled last week when RMC issued a downbeat trading update and said it would concentrate on heavy building materials and would sell assets that do not fit the strategy. J Sainsbury is unlikely to enter the fray as it concentrates on improving its struggling supermarket business.

Industry experts say a trade deal was more likely than a sale to a venture capitalist group.