Marks & Spencer has gone to Iceland, acquires 28 stores |
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Tue, 17 Jan 2006 20:05
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LONDON: Retailer Marks & Spencer Group Plc. is buying 28 stores from supermarket chain Iceland Foods Ltd to expand its Simply Food business. It will pay 38 million pounds for the leasehold of the stores and plans to convert them into the Simply Food format by August, the retailer said in a statement Tuesday.
The addition will take the number of the Simply Food outlets to 171, the statement added. The sale process is expected to be completed in March. All the Iceland Foods staff members will be transferred to Marks & Spencer.
The company, one of Britain's largest retailers and focusing mostly on clothing and apparels, is now expanding its food business as its finds customers are drawn to its luxury products. The food business led the Christmas and holiday sales growth, and contributes about 45 per cent of retailer's total revenue.
Marks & Spencer said each of the stores that are being bought has an average 5,000 sq. ft. and they will offer some 2,000 products including ready meals, wine and flowers. The stores are located in an area covering Torquay in southwest England to Edinburgh in Scotland.
The company's finance director Ian Dyson said the acquisition will enable the company to accelerate the growth of its popular and profitable Simply Food concept.
Iceland Foods, which is owned by a group of investors, including Baugur Group HF, has a total of 703 stores. The sale will reduce this number to 675. It plans to seek 60 new stores across the country. It is considered one of the fastest growing food retail chains in Britain, with sales having registered a growth of 15 per cent in the fourth quarter of 2005.
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