Buyout at Sears housebuilding arm

SEARS, the retail and mail order group that owns Selfridges on Oxford Street in London, is selling its housebuilding division, Galliford. The deal involves a buyout by Galliford's management and will net Sears pounds 27m.

Liam Strong, Sears' chief executive, said: 'The disposal completes the exit programme announced in 1990 and enables us to concentrate on our retail and home shopping markets where we have the potential to hold leadership positions.'

A pounds 28m extraordinary loss on the sale will be taken against Sears' results for the year to January, which are due to be announced on 27 April. Galliford's net assets were in the books at pounds 56m according to Sears' interim balance sheet in July.

Galliford is the last of a wide range of businesses, built up under previous management and sold as Sears refocused its activities. Its disposal was announced in 1990 but selling has been hampered by the slump in the housing market.

Sears has lost money in each of the past three years on housebuilding. In the year to January, the division lost pounds 7.5m before interest on sales of pounds 48.9m. In the previous year it had a carrying cost of pounds 11.2m.

Sears' shares ended yesterday down 2p at 99p.