PPR says in talks with Steinhoff to sell Conforama
French luxury goods retailer PPR said on Thursday it was in exclusive talks with South Africa's Steinhoff to sell its Conforama chain of furniture stores for 1.2 billion euros (1.6 billion dollars).
"This planned cession to a global furniture sector player is a major strategic opportunity for Conforama," PPR Chairman and CEO François-Henri Pinault was quoted as saying in a statement.
The deal, which would also include the repayment of an unspecified working capital debt to PPR, should be concluded within the weeks ahead following consultation with representatives of employees.
The sale in line with PPR's strategy since 2006 to focus on luxury and the sports and lifestyles sectors.
"Should this transaction be concluded, it will allow us to reinforce our position as one of Europe's leading integrated furniture and household goods companies..." Steinhoff International Holdings Ltd.'s CEO Markus Jooste was quoted as saying.
Conforama operates 241 stores, including 190 in France and 51 in six other European countries: Italy, Switzerland, Spain, Croatia, Portugal and Luxembourg.
The company generated 2.928 billion euros in turnover last year and has 13,400 employees.
Last year it was number two on the French furniture market, behind Ikea, with a market share of 14 percent.
"It's a good transaction, the price is superior to the mentioned floor price of 1.5 billion euros," Natixis analyst Boris Bourdet told AFP.
© 2010 AFP