Kingfisher boss Ian Cheshire has hit out against competition laws that he says are preventing the DIY group from transferring staff who work at the Focus DIY stores it has acquired.
Kingfisher purchased 31 stores from Focus’s administrators last month, and is waiting to hear how many it can covert to B&Q while remaining within competition laws. It will then have to sell off any remaining leases.
Cheshire is concerned that the Office of Fair Trading won’t make its decision before mid-July, by which time administrator Ernst & Young will be starting to make redundancies at the stores.
If the decision comes before the deadline, it will allow Kingfisher to transfer the staff without them having to go through a redundancy programme first, which Cheshire estimates would cost the taxpayer between £3m and £4m in statutory redundancy pay and benefits.
Cheshire said: “There are 700 people involved, we can’t easily take them on then to find out we can’t take the store and have to lay them off. The process is too long.”
Cheshire estimates that if all 31 stores are rebadged to B&Q, its share of the DIY market will increase by 0.3 percentage points.
The news comes as Kingfisher revealed a bumper first quarter. Profits surged 20.9% at constant currencies to £174m, while total sales were up 4.7% on the same basis to £2.7bn. Like-for-like sales jumped 3.3%.
In the UK and Ireland, where it trades as B&Q and Screwfix, like-for-likes were up 1.4% and profits up 14.7% to £83m. The French business, where Kingfisher trades as Castorama and Brico Depot, was the star performer, with a 31.5% increase in profits to £77m.
In its other international business, profits were up 7.3% to £14m.