May 25, 2018
Homebase garden party is over for DIY challenger Wesfarmers
The £340m acquisition of Homebase ranks among the worst deals struck on British shores, with total losses set to reach as high as $1bn after Wesfarmers agreed to sell out for the price of a pack of own-brand screws. Wesfarmers in part blamed Brexit effects but this was a corporate disaster of its own making; an ill-timed purchase at an inflated price marred by poor execution. The soft furnishings and garden ornaments that typically greeted Homebase shoppers would be pushed to the back; instead, there were to be incinerators and boiler suits in stripped-back DIY sheds. Other mistakes were made, not least Wesfarmers' decision to clear out Homebase management, removing 160 staff who knew the market best. The retail market is likely to get worse, particularly for shops such as Homebase reliant on large discretionary purchases.
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