Electronics chain Comet, which has shops in Norwich, Great Yarmouth and King’s Lynn, is set to change hands
Struggling electricals chain Comet is set to change hands for a token �2 today following days of tense talks with suppliers.
The company, which operates 248 stores, including in Norwich, Great Yarmouth, King's Lynn and Bury St Edmunds, will be sold to retail turnaround firm OpCapita in a deal which will see its former owner Kesa Electricals pump �50m into the business and take on its pension scheme.
However, the exchange has not been plain-sailing as veteran retailer and former boss at Dixons Retail John Clare, who is set to be appointed chairman of Comet following completion of the deal, met with suppliers to secure their support after trade credit insurers placed Comet under review.
Credit insurers protect suppliers against the risk of a retailer defaulting.
Comet fell victim to the consumer spending slump, which has hit the electronics market and led to rival Best Buy announcing the closure of 11 stores in the UK and catalogue chain Argos suffering weak sales.
Comet revenues fell 14.5pc on a like-for-like basis between November 1 and January 8 and it posted losses of �22m for six months trading last year.
Kesa had already announced plans to shut one of Comet's three warehouses, axe 12 of its 14 regional service centres and close nine under-performing stores as part of a cost-cutting drive.
- 1 Body found in the sea at Great Yarmouth
- 2 Holiday Inn to become 'care hotel' to help struggling hospitals
- 3 One of East Anglia's largest property builders is sold to investment firm
- 4 Norwich firm part of growing number of businesses working four day weeks
- 5 People are driving for hours to visit this loaded fries and doughnut kiosk
- 6 A year on: Tributes to teacher who died following tumour diagnosis
- 7 John Lewis CCTV footage leads to Norwich gun arrests
- 8 War-time bomb lay dormant for 80 years before exploding under fishing boat
- 9 1920s bungalow up for sale in one of the Broads' most sought-after villages
- 10 Arrive by boat at new Norfolk wedding venue
Mr Clare transformed Dixons into an international retailer in the 15 years he spent at the group.
In 1992, when he was appointed managing director of Dixons, it made pre-tax profits of �70.3m, but in the year before he left it made �302.9m.
Speaking about the Comet deal, he told the Daily Telegraph: 'I can see a real opportunity. This is not about doing a pre-pack or closing stores. This is about focusing on margin improvement, cost structure and cash management.'
Mr Clare is understood to have told suppliers that the review by trade insurers would not affect the business in the short term, as Comet has plenty of liquidity, and it hopes to re-secure trade cover when it presents a new business plan at the end of the month.
The electricals market in the UK has come under huge pressure as shoppers put off major purchases. Comet has previously admitted that 'big ticket' items such as TVs and large appliances were not selling well.