The Australian hardware chain Bunnings has pulled the plug on its disastrous $1bn venture into Britain, drawing an ignominious close to one of the worst retail acquisitions ever seen.
After burning through hundreds of millions of dollars trying to sell the all-conquering sandpaper-meets-sausage-sizzle formula to DIY-crazy Britons, Bunnings’ parent group, Wesfarmers, said on Friday that it was offloading the 200-plus chain of former Homebase stores for a reported £1 nominal fee to Hilco Capital.
The 24 stores that rebranded to Bunnings will convert back to Homebase.
Wesfarmers bought Homebase in 2016 for £340m, but struggled to retain customers. It said it expects a loss on disposal of between £200m and £230m from the sale.
Rob Scott, managing director of Wesfarmers, said the agreement follows a comprehensive review of the Bunnings UK and Ireland business, adding: “The investment has been disappointing, with the problems arising from poor execution post-acquisition being compounded by a deterioration in the macro environment and retail sector in the UK.”
The divestment is expected to be completed by 30 June 2018.
