Go Outdoors seeks stake sale to private equity

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The Independent Online

Go Outdoors, the outdoor clothing and equipment retailer, is poised to sell a minority shareholding to a private-equity firm to fund its expansion plans.

The 27-store chain is in talks with a number of private-equity firms – one of which is 3i, the listed buyout company – over selling a stake of about 20 per cent. The accountancy firm PricewaterhouseCoopers is handling the process for the Sheffield-based retailer. All parties declined to comment.

Go Outdoors has been the subject of intense speculation since John Lovering, the former chairman of the department store Debenhams and the pub chain Mitchells & Butlers, became chairman of the outdoor retail specialist last August. Mr Lovering is a serial deal maker in the retail and private equity world.

Go Outdoors is believed to have ruled out a sale of the business but the sale of a minority stake of about 20 per cent would provide it with fresh funding to help hit its target of 50 stores before the end of 2012.

In February, John Graham, the managing director of Go Outdoors, told Retail Week magazine: "We've got no plans to sell the business – only grow it. Floating is on our radar. We're not big enough at the moment but we might be next year."

In an earlier sign of its ambitions, Go Outdoors held talks last year with Blacks Leisure, the owner of Blacks and Millets, about a potential takeover of the group. But a bid never materialised, partly as Go Outdoors was thought to be interested in acquiring the 98-store Blacks chain, as opposed to both chains. Go Outdoors, which was founded in 1969, delivered record sales of £114.9m for the year to 30 January 2011. It more than tripled its pre-tax profits to £4.25m the previous year.

Meanwhile, Bathstore – the bathroom retailer owned by the building materials group Wolseley – is close to being sold to Electra Partners, the private-equity firm. The chain, which has more than 150 stores, is in exclusive talks with Electra. But it is thought that Bathstore's weak trading in 2011 means the price tag will be considerably below the £90m that Wolseley was hoping for.

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