UK DIY retailer Homebase has bought bathroom specialist Bathstore out of administration.
However, hundreds of jobs remain at risk as 124 stores are facing the prospect of closure.
The company will take over 44 branches and the Bathstore website, with plans to open a “significant” number of concessions within its own stores over the next 18 months, the company said.
Bathstore appointed BDO as administrator last month after the retailer collapsed after the then owner – American billionaire Warren Stephens – refused to inject more cash into the business to keep it afloat.
Homebase chief executive Damian McGloughlin said of the move: “We are absolutely delighted to welcome Bathstore into the Homebase family. With a reputation for quality service and excellent products, Bathstore complements Homebases’s reinvigorated range.”
Homebase has faced its own struggles over the last few years. In February last year the company reported a 86.6% cent drop in profits following an unsuccessful attempt to rebrand the DIY chain as Bunnings.
The home improvement retailer is one year into a rescue plan after it was bought from Australian brand Wesfarmers by turnaround specialist Hilco Capital for just £1 last year.
Wesframers, through its main brand Bunnings, had overseen a disastrous takeover during which it fired all the incumbent management only to create an offer better suited to its Australian home than the UK market. The company is thought to have lost around £1bn in exiting the business.
McGloughlin added that Homebase’s turnaround plan was on track and he said: “As a result of the hard work of the Homebase team, our turnaround is ahead of plan. While we still have a significant amount of work to do, the customer response to our new ranges has been very encouraging and we are on track to break even this year against a loss of over £100m last year.”
RPA Perspective Late last month Bathstore, the UK’s largest specialist bathroom retailer, collapsed into administration, with Ryan Grant and Tony Nygate of BDO’s restructuring unit appointed joint administrators.
BDO business restructuring partner Ryan Grant said at the announcement: “Despite significant investment into the business over the past five years, Bathstore has struggled to overcome the well-documented challenges facing the UK retail sector.”
He added: “The appointment was made after several months of difficult trading, and the failure of ongoing talks to find a buyer for the business. Bathstore is continuing to trade in administration, while the administrators seek a buyer.”
The business, based in Welwyn Garden City, said it was expecting to satisfy the majority of outstanding customer orders, with the support of key stakeholders. However, all installation services stopped with immediate effect.
