Kesa Electricals break-up talk grows as Comet tails off
A plunge into the red at struggling Comet piled the pressure on Kesa Electricals to press ahead with a break-up of the European electricals group today.
Activist investor Knight Vinke, the former scourge of HSBC, has built up a stake of more than 10% in the firm, fuelling speculation that the underperforming Comet business could eventually be hived off.
"We think that the best way to realise shareholder value is to break the group up," said Altium Securities analyst Philip Dorgan, who puts a sum-of-the-parts valuation of more than 200p on the stock. The shares were down 2.3p at 169.6p.
Chief executive Thierry Falque-Pierrotin, who is six months into a three-year turnaround plan at Comet, refused to comment on "rumours" but said: "We expect all countries to deliver their profit."
The World Cup pushed up demand for televisions in the first quarter, but trading fell away dramatically after that, leaving like-for-like sales 3.7% down in the six months to October.
But Comet also kept spending on store refits, with retail losses more than trebling to 6.4 million (£5.4 million).
The picture was brighter in France, where Kesa's Darty pushed up profits by 16% to 59.8 million, but the firm expects a tough Christmas in an "increasingly uncertain" market.
