Habitat’s European business has been sold by Hilco to Cafom SA, a French international home furnishings retailer.

Cafom SA has committed to purchase all 38 stores in Habitat’s European portfolio, for an undisclosed sum. The portfolio comprises 27 stores in France, 6 in Spain and 5 in Germany.

The sale, which remains subject to Works Council consultation and competition authority approval in France, is expected to complete before the end of August.

Cafom has also acquired the worldwide brand rights to the Habitat name outside the UK and Ireland.

Habitat’s UK & Ireland arm fell into administration last month, after which Home Retail bought three London stores and the brand for £24.5m. All UK stores outside London will close.

Hilco UK acquired Habitat from the Kamprad family in 2009. Hilco said it has led a “targeted restructuring and turnaround programme over the past two years” involving “significant capital investment in existing and new stores and a focused effort to reduce costs”.

Habitat opens a new store in Madrid in July after pervious openings this year in Antibes, Bilbao and Toulouse.

Hilco UK chief executive Paul McGowan said: “Over the past two years we have invested significantly to strengthen Habitat’s European store performance, and we have achieved the turnaround we wanted for our European operations and made it profitable. 

“There is much more to do and I am certain that Hervé Giaoui and his team at CAFOM will deliver further value in the European business. We are pleased that the new stores opened under Hilco ownership, including a large store in Antibes, have performed very strongly whilst the German market has started to recover following logistics changes made over the last 12 months.”

“Cafom is a natural partner for the European arm of Habitat. With expertise in the sourcing and manufacture of many of the products offered for sale by Habitat, Cafom will be able to ensure the continued development of market-relevant products.

“Cafom will be able to focus the product offering on the European customer rather than the UK customer. This is a perfect match for the employees and customers of Habitat across Europe and we look forward to seeing CAFOM grow the business from the platform we have re-established.”