DIY retailer Homebase collapsed into administration last night putting 2,000 jobs at risk.
A rescue deal by Chris Dawson, owner of The Range chain of discount stores, involved only 70 of Homebase’s 130 stores.
The entrepreneur – who has been dubbed the ‘Del Boy billionaire’ as he started out running a market stall – said he had saved up to 1,600 jobs.
History: Founded as a joint venture by supermarket Sainsbury’s and Belgian retailer GB-Inno-BM in 1979, the first Homebase store opened in 1981
But that leaves the rest of Homebase’s 3,600 staff anxiously awaiting news of their future just weeks before Christmas.
Homebase had already agreed to sell 11 shops to Sainsbury’s.
Administrators at Teneo said there would not be immediate redundancies as they tried to find a buyer for the remaining 49 UK stores.
The sites bought by Dawson will be turned into The Range superstores over the next few months.
‘We plan to continue to invest in the Homebase brand, with many initiatives in the pipeline,’ said CDS Superstores, which owns The Range and Wilko, in a statement last night.
Dawson told the Telegraph: ‘We are delighted to be able to save so many stores and jobs, and look forward to adding the Homebase brand and subsidiaries to the expanding Range group of companies.’
Homebase chief executive Damian McGloughlin called the past three years ‘incredibly challenging’ for the home and garden improvement sector, with sales at the retailer slumping.
‘A decline in consumer confidence and spending after the pandemic has been exacerbated by persistent high inflation, global supply chain issues and unseasonable weather,’ he said.
Attempts to get the business back on track had failed, leading to a ‘difficult decision’ to appoint administrators, he added.
Rescue deal: Businessman Chris Dawson (pictured) – owner of The Range chain of discount stores said he had saved up to 1,600 Homebase jobs
Cash-strapped consumers have turned their backs on home renovation in the past few years.
Susannah Streeter at broker Hargreaves Lansdown said: ‘Even though interest rates have begun to come down, homeowners have been ultra-cautious, with bigger ticket items hard to shift.
Some consumers appear to have been ring-fencing spending for holidays and experiences rather than major makeovers.’
It comes as retailers are braced for a bleak 2025, with Labour’s first Budget heaping an extra £2.3billion on the sector via the Chancellor’s National Insurance tax raid alone, and the rise in the minimum wage adding £367million.
‘It may take until 2026 to see wages affected by the NI hike, but Homebase will have had to factor in higher payroll costs, which may have made it look even less viable,’ Streeter said.
Founded by Sainsbury’s and Belgian retailer GB-Inno-BM in 1979, the first Homebase store opened in 1981 in Croydon before being spun off in 2000.
The retailer last changed hands in 2018, when its Australian owners Wesfarmers sold it to investment firm Hilco Capital for £1.
Dawson, 72, is understood to have paid £30million for Homebase’s website and intellectual property. The overall value of the deal has not been disclosed.
DIY INVESTING PLATFORMS
Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.