Kingfisher Group plans to sell the controlling stake in B&Q China to Wumart, a Chinese supermarket retail chain.
Under the official agreement signed between Wumart Group and Kingfisher Group, Wumart will invest CNY1.4 billion to acquire a 70% stake in B&Q China; while Kingfisher Group will retain a 30% stake in the joint venture. After the deal is approved by the Ministry of Commerce of China, Wumart Group will realize the full payment in cash. In the future, the B&Q brand will be maintained.
In March 2014, Kingfisher Group already announced plans to find a local strategic partner for its failing B&Q Chinese business. Kingfisher Group said in a report that they are glad to find a powerful retail partner to release the investment value of their Chinese business.
Qiao Hongbing, spokesperson of Wumart Group, said that the acquisition will not affect the stability of the existing management team of B&Q. The group will play to the strengths and enthusiasm of the existing management team to open up real business value.
B&Q entered the Chinese market in 1999 and its current annual sales are CNY4 billion. The company opened 39 household supply stores in first- and second-tier cities in China.
Headquartered in Beijing, Wumart Group operates 750 chain supermarkets in North China, East China, and the northwestern region.