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  19 October 2011

BCG buy out off

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Oct 2011 BCG Logo

The management buy out of kitchen, bathroom and heating distributor BCG from parent company Wolseley is off, kbbreview has learned.

 

The BCG business will now be folded into Wolseley's other brand Plumb Center and, it is believed, become more of a merchant-focused business.

 

Kbbreview understands that it was Wolseley who pulled the plug on the management buy out deal as it continues a severe restructuring strategy that has already seen the sale of Build Center, Electric Center, and Brandon Hire.

 

At the time of going to press, Wolseley has yet to confirm the BCG deal is over, saying only that "changes are being made." It is thought, however, that those changes include the departure of many of BCG's senior management.

 

A deal came close for the sale of the company's only consumer-facing business Bathstore earlier in the year, however it fell through after poor sales figures were revealed.

 

Wolseley revealed its annual results several weeks ago, which showed a 15% drop in Bathstore sales in the 12 months up to the end of July, compared to the same period in 2010. The company took a write-down of £29 million to reflect the retail chain's reduced value on the Wolseley books.

 

For the company as whole, like-for-like sale were up 2% and trading profits jumped from £18m to £109m. Group pre-tax profits were £391 million, compared to 2010 were it made a loss of £328 million. This is the company's first annual profit since 2008.

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