Investment firm Baugur is to sell its media, technology and financial services arm for £430 million generating a substantial 'war-chest' for new retail acquisitions.
Baugur said it had reached an agreement to sell the media, technology and financial investments businesses to two independent companies for £430 million. The investment group said the sale marked the final phase of the restructuring of its portfolio of investments and that the group would now focus purely on new opportunities in the retail sector on top of its existing retail investments.
Baugur Group chief executive Gunnar Sigurdsson said: "These changes place us exclusively in the retail space, where we have unrivalled experience. It builds our existing war-chest which will allow us to take advantage of investment opportunities which will arise in the current market conditions. We will also continue to build on the existing strengths of our brand portfolio which already is valued in excess of £1.5 billion and has significant global potential. The ability to drive value creation lies in enhancing their already formidable position in their home market as well as focusing on building their strengths in the key growth channels, such as the emerging markets and on the internet."
In addition to refocusing Baugur's interests purely on retail, the divestment rebalances Baugur's geographical portfolio, with some 85% of the groups assets being in the UK, the US and Scandinavia following the transactions.
Baugur Group chairman Jon Asgeir Johannesson said: "These changes mark the conclusion of events we set in train last year and will place Baugur in an exceptional position to further grow its unique retail portfolio. The current times are challenging and very exciting and with the quality of our portfolio of brands, we are in a great position to be at the forefront of developments on the worldwide retail scene."
Baugur's retail investments include Mosaic Fashions which owns the Karen Millen, Oasis, Warehouse, Principles, Shoe Studio and Coast brands. It also has interests in House of Fraser, Whistles, Jane Norman, MK One and All Saints.
Baugur made a £40m indicative offer for menswear chain Moss Bros earlier this year. It is in the process of completing due diligence but family shareholders believe the offer significantly undervalues the business.