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Austria's BauMax to close Turkish DIY stores
April 3, 2014 / 10:31 AM / 4 years ago

Austria's BauMax to close Turkish DIY stores

VIENNA, April 3 (Reuters) - Struggling Austrian home-improvements store chain BauMax will close its seven outlets in Turkey and may exit other markets in southeast Europe, its owner said.

BauMax, which employs about 10,000 staff in nine countries, made a loss of 126 million euros ($173 million) in 2012 after overextending itself with a push into eastern Europe, and most recently into Turkey in 2010. It has not published 2013 results.

“We will close Turkey,” owner Karlheinz Essl told ORF television after his offer to sell his contemporary art collection worth an estimated 250 million euros to the Austrian government - which he argued could help save thousands of jobs in the company - was rejected on Wednesday.

“We are in the process of considering whether there will be other countries. That will be decided by the end of April,” Essl said.

BauMax’s creditor banks - including Raiffeisen, Erste Group and Bank Austria - are due to meet on April 28 to decide whether to approve a restructuring plan for BauMax, which like other DIY chains operating in Europe has suffered from weak demand due to sagging housing markets and depressed economies.

German rival Praktiker said in February it would close its stores in Turkey and withdraw from the country after failing to sell its nine stores there.

BauMax has 158 stores, almost half of them in Austria and the rest in the Czech Republic, Slovakia, Hungary, Slovenia, Croatia, Romania and Bulgaria, as well as Turkey. ($1 = 0.7263 Euros) (Editing by David Holmes)

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