* Darty to sell operations in Italy to DPS Group
* To take 15 percent stake in DPS
* Darty to pay DPS 3 mln euros
* Deal includes Darty Italy's 20 stores
* Darty shares rise as much as 10 percent
Nov 21 Darty Plc, Europe's
third-largest electrical goods retailer, plans to sell its
Italian operations to Italy's DPS Group SRL and take a 15
percent stake in it, sending Darty's shares up as much as 10
France-based Darty, formerly known as Kesa, said it will pay
electrical goods retailer DPS 3 million euros ($3.8 million) as
part of the deal.
"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 the Darty Italy head office, along
with certain working capital adjustments on completion, was
expected to be about 11 million euros, the company said.
Darty Italy is a part of the company's developing businesses
division, which also includes Spain and Turkey.
For the year ended April 30, Darty Italy's operating loss
was 55.7 million euros, which included 36 million euros in
impairment charges and costs related to store closures.
The retailer is battling aggressive discounting from online
retailers, along with low growth, high unemployment and brutal
government spending cuts in Europe.
Wednesday's sale is part of Darty's ongoing review of its
country-by country 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 6.82 percent at 47 pence at 0950 GMT
on the London Stock Exchange. They rose as much as 48.5 pence