Retail news round-up on March 3, 2014: Maplin up for sale, M&S hires Next Sourcing gurus, Warren Buffet cuts Tesco stake, John Lewis Partnership to slash annual staff bonus and more.
Maplin up for sale as owner Montagu eyes £500m exit
Electronics retailer Maplin has been put up for sale with a price tag of £400m to £500m by its business owner Montagu Private Equity, The Telegraph reported. Montagu is understood to have hired accountants PwC to lead the sales process, which comes following a series of approaches to snap up the 214-strong chain.
The approaches are understood to have come from trade buyers, with a sale to a larger player in the sector or a rival private equity firm thought most likely. Montagu is learnt to have dismissed the possibility of an initial public offering.
M&S hires sourcing directors for general merchandise
Marks & Spencer’s chief executive Marc Bolland is understood to have poached two brothers Mark and Neal Lindsey as sourcing directors for general merchandise, effective March 3, Sky News reported. Hong Kong-based Lindsey brothers are tasked with specific responsibility for clothing and footwear as well as boosting M&S’ margins. The duo is likely to report to executive director for general merchandise, John Dixon.
According to insiders, the recruitments will give the duo powerful influence over much of the retailer’s commercial activity, overseeing its network of regional sourcing offices around the world as well as its large London-based central sourcing team. Both were responsible for the growth of Next Sourcing, which streamlined Next’s supply chain to improve its speed and efficiency, according to analysts.
Their appointment has raised questions internally about the status of Krishan Hundal, the executive with existing oversight of sourcing. An insider said that his role would continue to be as important as he focused on quality, innovation, packaging, technology, ethical sourcing and delivering on commitments made under M&S’ Plan A corporate sustainability project.
Investor Warren Buffet cuts stake holding in Tesco to 3.7%
Multi-billionaire investor Warren Buffett has cut his stake in troubled Tesco by almost 30%, The Guardian reported. Results from his Berkshire Hathaway investment company disclosed that he has reduced his holding in the supermarket giant to 3.7% from 5.2%, thereby selling 115 million shares in the company last year.
In a letter to Berkshire shareholders, Buffett did not mention Tesco but affirmed his faith in long-term investments, advising his readers to ‘invest in stocks as you would in a farm.’ The sale may be a further knock to wider faith in Tesco’s prospects.
John Lewis Partnership to slash annual staff bonus in 2014
The John Lewis Partnership which owns John Lewis and Waitrose, is set to record £370m in profits this week after the business enjoyed one of the most successful Christmas trading periods in its history, The Telegraph reported.
The annual staff bonus is likely to be less this year because of the increasing cost of servicing the retailer’s pension deficit. The Partnership will reduce the bonus to its 85,500 staff to around 15% of their annual salary, analysts suggest. JLP will reveal the bonus percentage during a ceremony on Thursday morning. The bonuses will be paid out in a year when John Lewis will mark its 150 years with a series of special events.
Uniqlo-parent Fast Retailing mulls $5bn J.Crew acquisition
Uniqlo parent Fast Retailing Co and South Korean fashion conglomerate E.Land Group are separately exploring a deal for US chain J.Crew, reports Reuters.
J.Crew, which was taken private by TPG Capital and Leonard Green & Partners for $2.8 billion in 2011, believes it could fetch at least $5 billion in any sale.
Thorntons profit surges in its first half
Chocolatier Thorntons pre-tax profit jumped from£4.9m to £7.2m in its first half as its FMCG division outgrew retail sales.
Sales rose 4.5% to £139.7m over the half to January 11. FMCG sales grow by 14.5% to £70.6m while retail like-for-likes edged up 2.1%.
Thorntons chief executive Jonathan Hart said: “ We are pleased to report further increases in both revenues and profits as we continue on our journey of transforming Thorntons towards an international FMCG business and UK multi-channel retailer.”