Newspaper article Evening Gazette (Middlesbrough, England)

MFI Agrees to Sell

Newspaper article Evening Gazette (Middlesbrough, England)

MFI Agrees to Sell

Article excerpt

Byline: Helen Logan

Struggling furniture chain MFI today agreed to sell its loss-making retail arm for just pounds 1.

The company struck a deal to offload its 200 stores, including Middlesbrough, Stockton and Darlington, to private equity firm Merchant Equity Partners for the nominal fee.

MFI will also pay Merchant pounds 74m between now and April 2008 to invest in the stores, which its manufacturing arm will continue to supply.

It will change the name of the rest of the business, which also includes Howden Joinery, to Galiform.

MFI, which earlier this year shut its Stockton factory with the loss of more than 500 jobs, began the auction of its retail sector in May.

The retail business, which has suffered in the past from supply chain problems, made operating losses of pounds 85.1m in its last financial year - 171% worse than the year before.

The problems saw MFI shares plummet from 143p in February last year to as low as 65. …

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