Sunday Times says the company, which has its headquarters in Speke, has drawn up a ‘list of targets’ in France in order to gain a foothold in the market across the Channel. Tony McDonough reports
Liverpool-based discount retail chain B&M is looking to acquire a French retail operator in a bid to become one of Europe’s biggest players, according to a media report.
The Sunday Times says the company, which has its headquarters and main distribution depot in Speke, has drawn up a “list of targets” in France in order to gain a foothold in the market across the Channel.
It adds that B&M chief executive Simon Arora is already in talks with one local chain. The company already owns German discounter Jawoll, which it acquired in 2014, and operates 86 outlets.
Rapid growth
UK retailers are enduring a torrid time with falling sales threatening the survival of a number of brands. In the last few days fashion chain Coast was rescued out of administration by Karen Millen.
However, stock market-listed B&M continues to thrive. Brothers Simon and Bobby Arora bought the chain, then with just 21 stores, in 2004 and set about transforming it into a multinational retailer with 576 B&M stores across the UK, opening 39 in the past year alone.
In August last year it swooped to buy Northern grocery chain, Heron, in a deal worth £152m and currently operates 265 outlets across the UK. More B&M, Heron and Jawoll store openings are planned over the next year.
It unveiled its latest full-year financial results in June, with sales and pre-tax profits both up 25% to over £3bn and £229.3m respectively. Last year, supermarket giant Asda was reported to have considered a £4.4bn bid for the business.
Chinese suppliers
B&M keeps costs low by cutting out middlemen and dealing directly with Chinese suppliers and, at any one time, offers 6,000 different products to its customer, and responds quickly to demand by frequently rotating the range.
In 2012 private equity house Clayton Dubilier & Rice (CD&R) bought a 60% stake in the business and four years ago it was floated on the stock exchange with a value of £2.7bn. The Arora family retains a 15% stake.
CD&R has sold its holding in the retailer in a series of tranches and in January sold its remaining 5% stake for £200m. In total the investor will have made £1.5bn out of the chain.