MFI to merge with Moben?

18 September 2008

Two of the biggest names in kitchen, bedroom and bathroom retail are rumoured to be in merger talks - a move that could create a chain of over 350 stores nationwide.

MFI and rival Homeform - the group that runs Moben, Sharps, Dolphin and Kitchens Direct - have been the subject of several press rumours based on ongoing speculation that MFI is struggling.

MFI was bought from Galiform for £1 in 2006 by Merchant Equity Partners (MEP) with crippling debts but the worsening market has led, the rumours say, to further problems for the beleaguered brand.

Reports in both the Sunday Times and the Telegraph say MEP is now actively looking for a partner, with Homeform the most likely candidate. Initial talks have already taken place, the newspapers say.

It is also thought that Magnet's parent company Nobia has been approached.

Speculation over MFI's future was ignited after two senior directors from retail-turnaround specialist Hilco were appointed to the MFI board as well as the arrival of other consultants to look at the company's finances.

Homeform itself was bought by another private investment group, Sun European, in April last year.

Cutting through the rumour and speculation of this possible merger deal is difficult. Homeform deny any knowledge of talks and sources suggest MFI is starting rumours to make sure the market knows it's looking for a partner.

MEP, on the other hand, is officially neither confirming or denying the story but insists MFI is a sound business and is simply 'looking at its strategic options'. Likewise, MFI sources suggest the story has been leaked by Sun European.

Magnet owner Nobia simply said, 'we do not comment on rumours'.

People working within MFI told kbbreview that there has been a concerted effort to run the company down in the business press and that talks of restructuring and refinancing are 'completely wrong'.

There are, they say, no debts to restructure, the company is cash positive and has money in the bank. It is struggling in the current climate but no more than anyone else. "People are almost willing the company to fail," the insider said.

However, it's clear that by not openly denying that MFI is seeking commercial partners speculation can only increase.

An MFI spokesman told kbbreview: "A lot of retail businesses are looking at their strategic options, that doesn't mean they've chosen them, and MFI is no different. The business is trading as well as can be expected in this environment and part of the reason is that it's in a strong position after getting through a significant part of the turnaround process ahead of schedule.

"The business is in a better position today than it would've been if MEP had not taken it over."

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MFI to merge with Moben?	Back
18 September 2008 Two of the biggest names in kitchen, bedroom and bathroom retail are rumoured to be in merger talks - a move that could create a chain of over 350 stores nationwide. MFI and rival Homeform - the group that runs Moben, Sharps, Dolphin and Kitchens Direct - have been the subject of several press rumours based on ongoing speculation that MFI is struggling. MFI was bought from Galiform for £1 in 2006 by Merchant Equity Partners (MEP) with crippling debts but the worsening market has led, the rumours say, to further problems for the beleaguered brand. Reports in both the Sunday Times and the Telegraph say MEP is now actively looking for a partner, with Homeform the most likely candidate. Initial talks have already taken place, the newspapers say. It is also thought that Magnet's parent company Nobia has been approached. Speculation over MFI's future was ignited after two senior directors from retail-turnaround specialist Hilco were appointed to the MFI board as well as the arrival of other consultants to look at the company's finances. Homeform itself was bought by another private investment group, Sun European, in April last year. Cutting through the rumour and speculation of this possible merger deal is difficult. Homeform deny any knowledge of talks and sources suggest MFI is starting rumours to make sure the market knows it's looking for a partner. MEP, on the other hand, is officially neither confirming or denying the story but insists MFI is a sound business and is simply 'looking at its strategic options'. Likewise, MFI sources suggest the story has been leaked by Sun European. Magnet owner Nobia simply said, 'we do not comment on rumours'. People working within MFI told kbbreview that there has been a concerted effort to run the company down in the business press and that talks of restructuring and refinancing are 'completely wrong'. There are, they say, no debts to restructure, the company is cash positive and has money in the bank. It is struggling in the current climate but no more than anyone else. "People are almost willing the company to fail," the insider said. However, it's clear that by not openly denying that MFI is seeking commercial partners speculation can only increase. An MFI spokesman told kbbreview: "A lot of retail businesses are looking at their strategic options, that doesn't mean they've chosen them, and MFI is no different. The business is trading as well as can be expected in this environment and part of the reason is that it's in a strong position after getting through a significant part of the turnaround process ahead of schedule. "The business is in a better position today than it would've been if MEP had not taken it over."