Homebase sold in rescue deal to CDS but 2,000 jobs still at risk

Homebase has been sold to retail group CDS in a rescue deal securing up to 1,600 jobs and 70 stores.

However, the future of around 2,000 workers and 49 stores remains unclear. Jobs at risk include roles at Homebase’s head office in Milton Keynes and within the remaining stores.

CDS, parent company of The Range, bought the majority of Homebase’s stores after the 45-year-old DIY retailer appointed administrators at consultancy Teneo on Wednesday.

Teneo said the remaining stores would continue trading as normal while administrators search for a buyer. The locations of these outlets were not immediately disclosed.

Damian McGloughlin, Homebase’s chief executive, said the last three years had been “incredibly challenging” for home and garden improvement firms thanks to “a decline in consumer confidence and spending” after the Covid-19 pandemic.

“Against this backdrop, we have taken many and wide-ranging actions to improve trading performance including restructuring the business and seeking fresh investment,” he added.

“These efforts have not been successful and today we have made the difficult decision to appoint administrators.”

Wednesday’s sale ends the ownership of Homebase by Hilco, which bought the firm from Wesfarmers in 2018 for £1. Its hunt for a new buyer is understood to have lasted around two months.

Hilco embarked on a wave of cost-cutting measures in the years after its purchase. However, Homebase reported an £84.2m loss last year as the cost-of-living crisis hit consumer spending.

In August, Sainsbury’s agreed to buy 10 Homebase stores and convert them into supermarkets.

CDS is owned by retail tycoon Chris Dawson. Nicknamed “the Del Boy billionaire”, he told The Telegraph on Wednesday morning that he was “delighted to be able to save so many stores and jobs”.

Last year, the group snapped up the brand and intellectual property assets of Wilko for £7m to after the retailer collapsed into administration.

Alex Simpkin, CDS’ chief executive, commented: “We’ve stepped in following the sad demise of the much-loved Homebase brand, which has had a long and previously successful history of helping UK households with their DIY projects and gardening needs for over 45 years.”

Teneo said all employee wages and benefits will be paid for their period of employment, while customer orders will still be fulfilled “as far as possible”.

It is unclear which stores will retain the Homebase brand after the deal.