Homebase stores in Essex could close despite rescue deal

The fate of Homebase stores in Colchester, Basildon, Harlow, Saffron Walden, and Rayleigh are uncertain after the retail giant appointed administrators at consultancy firm, Teneo, on Wednesday.

Retail group CDS, which owns The Range homeware stores, has now purchased Homebase in a rescue deal.

Thanks to CDS up to 1,600 jobs and 70 stores have been rescued but the future of its remaining 2,000 workers and 49 shops is uncertain.

The list of saved stores has not been confirmed yet.

Teneo has said the remaining 49 UK stores will continue to trade as normal while administrators try to find a buyer.

CDS is owned by retail magnate Chris Dawson, who bought the 40-year-old Homebase brand.

Damian McGloughlin, chief executive of Homebase, said the last three years had been “incredibly challenging” for DIY stores, blaming “a decline in consumer confidence and spending” after the pandemic.

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

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

Homebase was bought for £1 by investment firm Hilco Capital in 2018, which introduced a swathe of cost-cutting measures in the subsequent years.

But the retail chain struggled as customers cut back on spending amid the cost-of-living crisis, and reported an £84.2 million loss last year.

In August, Sainsbury’s struck a deal to buy ten Homebase stores and convert them into supermarkets.

The rescue deal comes after a hunt for a buyer from Homebase’s previous owners Hilco, which is thought to have lasted for the last two months.

Mr Dawson also bought parts of high street retailer Wilko after it collapsed last year.

The administrators have said Homebase employee wages and benefits will be paid for their period of employment, while customer orders will still be fulfilled as far as possible.