The big Comet sale, cheap as chips

 

By Posted 9 Nov 2011, 11:08

A few days ago we gave you the news that Best Buy was to close operations in the UK in light of the tough conditions currently surrounding consumer spending on electrical items. Now today we have news of the big comet sale where the company has gone for a cheap as chips price.

The loss making retail chain has been sold by parent company Kesa Electricals for only £2, and according to a report here the new owners will also receive a £50 million sweetener. It has also been revealed that the chains sales have plummeted by almost twenty percent for the first six months of its financial year.

Also See: Comet UK: Retailer eyes administration, jobs in jeopardy

OpCapita are the new owners of the retail chain and specialize in turning around struggling retail operations. The company have said it currently has “no intention to make redundancies”, or shutting any of the 248 stores. OpCapita will take up the existing cost-cutting plans and have promised to operate Comet for a minimum of eighteen months after the deal goes through in February 2012.

Comet employs around 10,000 staff and despite promises of no intentional job losses it will still be a worrying time. The £50 million that Kesa is providing is to be categorized as an investment, and they will only see a return if Comet is sold on for more than £70 million. Investors with OpCapita will put in a further £30 million and will have another £40 million available as a backup.

Kesa saw its shares climb by seven percent after the announcement, which would have been helped by the loss of the chains annual lease bill of £90 million. Do you think there will be store closures once the deal goes through?