Sir Tom Hunter sells D2

Hunter has offloaded D2 to declutter his portfolio

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Sir Tom Hunter has offloaded his D2 chain to streamline his retail porfolio.

Co-founders of D2 Alan Kinney and Jim McGonigle have led a management buyout of the D2 chain for an undisclosed sum.

Hunter's retail investments have struggled to compete with rivals in recent years and 80-store D2 made a loss for the first time in its seven year history last year. It recorded pre-tax losses of £1.7 million on sales of £50 m for the year to January 31 2007. Hunter's USC and Qube chains also sustained heavy losses in 2006/2007.

D2 will continue to operate out of Hunter's West Coast Capital headquarters in Dundonald in Ayreshire in Scotland. McGonigle will continue as chief executive of Hunter's USC chain and will be a silent partner in D2.

Managing director Kinney added: "This will give all the team at D2 the opportunity to continue to grow the business and benefit from its long-term success. Whilst retail is tough right now, our mid-market position and our ability to move fast in delivering fashion to the marketplace will, we are sure, see us move forward positively on the high street."

Hunter said in a statement: "We've structured this deal to give the new owners the very best opportunity from which to capitalise on their position in the market and we are sure they'll do well.
This for us is really part of a decluttering strategy. Our business is now largely focussed on sizeable retail investments like House of Fraser and Wyevale alongside a heavy focus on property and international investment."

He made no specific comment as to the future of his Office, USC and Qube chains, which are all relatively small in size.