Darty to sell loss-making Italian business
Nov 21 (Reuters) - France's Darty Plc, formerly known as Kesa, plans to sell its loss-making Italian operations to DPS Group SRL and take a 15 percent stake in the Italian electrical goods retailer.
Darty, Europe's third-largest retailer of electrical goods, did not disclose the deal value, but said it will pay DPS 3 million euros ($3.8 million).
"The current business is sub-scale, operating in a difficult market with the achievement of a profitable market position highly unlikely in the medium term." Darty Chairman, Alan Parker, said in a statement.
The cost of closure of operations in Italy, along with certain working capital adjustments on completion, was expected to be about 11 million euros, the company said.
Darty, along with bigger rival Media Markt Saturn, is battling competition from supermarket chains and online retailers at a time when demand has stagnated.
Wednesday's sale is part of Darty's ongoing review of its operations.
Darty had to pay a 50 million pounds ($80.4 million) dowry to a private equity firm last year to take its loss-making UK business Comet off its hands.
Shares in Darty were up 6 percent at 46.5 pence at 0811 GMT on the London Stock Exchange.
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