Morrisons has put Kiddicare up for sale three years after buying it, during which time the maternity retailer’s fortunes have plummeted sharply.

Why are we talking about this now?

Last week struggling grocer Morrisons revealed that it was looking for a buyer for Kiddicare, the maternity specialist it bought just three years ago. Kiddicare has gone from being a successful etailer to an embattled multichannel retailer. This is reflected in the fact that Morrisons - which has plenty of woes of its own - might have to pay a dowry to any potential new owner, just to get it off its books. Speculation is rife about a number of potential buyers including trade and restructuring firms.

What went wrong?

Back in 2011 Scott Weavers-Wright had plenty of options. Retailers were lining up to buy the online business he formed out of a store chain dating back to when he was a baby himself. Morrisons won that race, bought the business for £70m, and immediately international expansion and domestic growth for Kiddicare was on the cards. With Morrisons desperately needing an online platform and Kiddicare looking for the capital to grow, it seemed like the perfect match.

Fast forward to 2014 and things have changed dramatically. Morrisons revealed last week that in the last year it had incurred £163m charge on Kiddicare, just as it was announcing total losses of £176m. Morrisons said Kiddicare had delivered a “disappointing” performance and said it was “no longer strategic”.

It is widely believed that the move to open 10 shops in former Best Buy stores in 2012 was ill-judged. Furthermore, some have questioned Morrisons’ commitment to the business since.

Speaking at Retail Week Live last week, Weavers-Wright said that Morrisons had “acquired Kiddicare for its technical platform and did not implement it”. Weavers-Wright said the “lack of integration with Morrisons’ core business” was a factor in Kiddicare’s troubles.

Conlumino lead consultant Joseph Robinson says: “It was a wasted opportunity. Kiddicare is a strong platform and Morrisons could have used that to deliver its non-food online sales.”

Who might buy it?

There is already speculation that a number of retailers could look to pick up Kiddicare. Companies to have eyes it last time it was up for sale were said to include Amazon, Halfords, The Hut and Tesco, although it is thought the latter has ruled itself out this time round.

Robinson believes that a private equity buyer is a more obvious choice. He says: “Kiddicare is a strong brand but it’s losing money; I can’t see a retailer with an online platform already established taking it on. It could well be a private equity buyer. It needs someone who will focus on its strengths”.

How is the rest of the maternity sector performing?

Kiddicare isn’t the only one struggling with maternity at the moment. The sector leader Mothercare is shedding a third of its stores after three years of falling like-for-likes, and has appointed Mark Newton-Jones to step in, on an interim basis, and turn things around.

Mamas & Papas seems to be holding its own, but Mothercare has been squeezed from either side by the supermarkets and online retailers both of which have managed to beat them on price. And with Amazon now reputed to be the leading seller of prams in the UK, clearly Mothercare and now whoever buys Kiddicare, have their work cut out.