Tesco shuts down its chain of Dobbies Garden Centres
TESCO has sold its Dobbies Garden Centres as chief executive Dave Lewis continues to prune non-core assets to focus on reviving its grocery operation.
Dobbies Garden Centres sold off
Edinburgh-based Dobbies, the UK’s second biggest garden chain behind Wyevale, is being bought by a group of investors led by Midlothian Capital Partners and Hattington Capital for £217million.
Britain’s biggest retailer had bought Dobbies for £155million in 2007 when Sir Terry Leahy was chief executive as it looked to branch out beyond food to woo shoppers.
It has 35 stores and employs over 2,700 staff. Lewis, pictured, said it had been a “difficult decision” to sell Dobbies, which contributed £17million to Tesco’s annual pre-tax profi t of £162million as the supermarket giant returned to the black following a £6.3billion loss the previous year.
He said: “Dobbies colleagues have built a great business, and I would like to thank them for everything they have done.
"We believe this agreement will give Dobbies a bright future, while allowing our UK retail business to focus on its core strengths.”
Dobbies commended for building a great business
Dobbies colleagues have built a great business
The buyers said they had committed to protect jobs and keep the head office in Scotland and would invest for longterm growth.
Midlothian’s Andrew Bracey said: “Dobbies is an iconic brand and we believe it can be the market leader in the garden centre sector.
It has a superior team that, with our long-term vision and capital, will grow this business across Britain.”
Tesco prunes its non-core assets
Tesco to sell Kipa and Giraffe businesses
Hattington’s Barney Burgess described the deal as “one of the most exciting opportunities in British retail”.
The sale of Dobbies follows Tesco’s announcements last week that it is offloading its Giraffe restaurant chain and its Turkish operation.
It had already raked in £4.2billion by selling its South Korean business Homeplus last year.
Analysts suggested its Harris + Hoole coffee shop chain could be the next business to be sold.
Graham Spooner, investment research analyst at online broker The Share Centre, said: “The disposal of Dobbies is another step in Tesco’s restructuring programme as it seeks to strip away costs and focus on its core supermarket business.”