The Peacock Group has entered exclusive talks with private equity investor Duke Street about a sale of its mature womenswear business Bonmarché.
The group, which also owns the Peacocks value chain, appointed DC Advisory Partners last month to look at options for the business.
It is unclear what price Duke Street is willing to pay for the 387-store chain but it is expected that a deal could be finalised within weeks. Last year the group explored options including a sale or refinancing, but potential investors baulked at the £500m to £600m price tag attached to the whole business.
Duke Street is understood to be working with a well-known industry figure on the deal, who will potentially lead the business if a sale is completed.
Value retailer Bonmarché targets women aged over 45 and stocks sizes 12 to 24. The sector provides growth potential as it is currently under-served by bricks-and-mortar retailers, with etailers such as N Brown and Shop Direct Group accounting for most of the business in the mature, plus-size market.
The Peacock Group bought Bonmarché from the Chima brothers in 2002 for more than £50m. In the year ended April 3, pre-tax profits were £5.3m compared with £936,000 the year before. Total sales rose 2.9%.
In 2005, the group was taken private in a deal led by boss Richard Kirk, Goldman Sachs and hedge funds Och-Ziff and Perry Capital.
In February the group prompted speculation of a possible flotation after it said it intended to appoint a chairman for the first time in five years. However, Kirk – who owns 30% of the business – has said that the search did not indicate the business was set for an IPO.
Duke Street’s current investments include department store chain The Original Factory Shop and Sandpiper, which operates 38 convenience stores under the Checkers Xpress and Safeway brands in the Channel Islands, as well as operating Marks & Spencer’s Jersey franchise.