Up to 700 jobs saved as new owners reverse Homebase store closure plans

Australian group Wesfarmers, which acquired Homebase in February for �340m, is reversing up to 18 st

Australian group Wesfarmers, which acquired Homebase in February for �340m, is reversing up to 18 store closures planned by the previous management. Photo: David Parry/PA - Credit: PA

Up to 700 jobs could be saved at DIY chain Homebase after the retailer’s new owner said it was scrapping plans to close a number of stores.

Australian retail giant Wesfarmers said it was looking to keep open 18 stores previously earmarked for closure in a move that will protect between 500 and 700 jobs.

The firm has been racing to stop the store-closure plan introduced by the previous management since it bought Homebase in a £340m deal from Argos owner Home Retail Group in February.

A spokesman said: “New management have successfully reversed the closure of seven Homebase stores, saving approximately 200 jobs. It hopes to prevent the closure of 11 more, saving up to 500 jobs.

“Unfortunately, there have been five unavoidable store closures, with approximately 200 employees affected. However, it is worth highlighting that any employees affected are given priority for job opportunities at other stores within a 30-mile radius.”

The move comes with the company having just appointed retail veteran Archie Norman, a former chairman of Asda, to a board advising on Homebase’s turnaround.

Wesfarmers already owns Bunnings, Australia’s largest DIY and garden products chain, and plans to rebrand Homebase’s 260 UK stores under the Bunnings fascia.

Homebase was originally founded by supermarket Sainsbury’s as a joint venture with Belgian retailer GB-Inno-BM in 1979 as Sainsbury’s Homebase.

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The supermarket sold the business in 2000 for a total of £969m, with buyout firm Schroder Ventures (now known as Permira) acquiring the Homebase chain for £750m and Kingfisher, owner of DIY rival B&Q, paying £219m for 28 development sites earmarked for new stores.

Homebase changed hands again just two years later when it was acquired by the retail group GUS, which subsequently changed its name to Home Retail Group, for £900m.

Sainsbury’s won a four-month battle in April to buy Home Retail Group after agreeing a £1.4bn deal. Its interest was always in the Argos business which it plans to use as a platform for boosting its non-food sales.