Bunnings owner Wesfarmers is scouting for potential buyers of its UK DIY chain and has drafted in Lazard to advise.
The Australian retailer is also considering implementing a CVA at Bunnings, which employs about 12,000 people in the UK and has 250 shops.
The possible sale – originally reported by Sky News – came as Bunnings reviews its future in the UK, where it made its debut with the £340m acquisition of Homebase – a purchase which it has botched.
Lazard is understood to have contacted a variety of possible buyers over the past couple of weeks and ahead of an update on the future of Bunnings in nine weeks’ time.
A sale is thought to be the most likely outcome, but other options including a CVA are also being considered.
Bunnings already intends to shut up to 40 underperforming branches. A CVA could also pave the way for rent reductions at other stores.
After buying Homebase in 2016, Bunnings aimed to take on UK market leader B&Q. However, it has ended up having to write off more than £500m after abandoning some of Homebase’s most popular lines.
Bunnings also axed the Homebase management team and parachuted in its own Australian chiefs, who believed British shoppers would flock to its warehouse-style stores.
In the event, sales at the retailer – which also operates in Ireland – plummeted by 15.7% and it suffered a £97m pre-tax loss.
Lazard was involved in Wesfarmers’ acquisition of Homebase. Marks & Spencer chairman Archie Norman also chairs Lazard’s London business and has held other roles at Wesfarmers for several years.
Norman is thought to have advised Wesfarmers not to buy Homebase.