(Reuters) - Majestic Wine could sell its 200 or so branches in Britain as it shifts focus to its booming online business Naked Wines, the retailer said on Tuesday.
The announcement is the latest sign of the challenges facing Britain’s traditional store groups, with rising property taxes and sluggish consumer spending adding to competitive pressures from online rivals and discount chains.
Majestic, Britain’s largest specialist wine retailer, said last month it was looking to sell some assets, close stores and review its dividend, but did not say at that stage it might sell all of its UK stores.
Sky News reported earlier, citing unidentified sources, that Majestic had appointed investment bank Rothschild to seek potential buyers and also reached out to private equity firms to assess interest for a possible acquisition of its UK stores.
“While a total sale of Majestic Retail continues to be a potential option, it would be wholly unwise to pursue a single track process and materially limit the potential value that can be realized to drive growth,” a company spokesman said.
“We believe the combination of customer migration, disposals and store closures from Majestic Retail will release substantial investment capital and transform the company into an out-and-out growth business.”.
Majestic Retail employs more than 1,000 people, according to its website. The company will provide more details of its plans on June 13, the spokesman added.
Majestic shares were up 1 percent at 1345 GMT.
The company, which has over a million customers in Britain, the United States and Australia, plans to rename itself Naked Wines Plc. It bought the online retail business in 2015 and has since more than doubled its size.
As well as Majestic Retail and Naked Wines, the company operates Majestic commercial, which supplies wine to business; and Lay and Wheeler, a specialist fine wine merchant.
Majestic has also been trying to grow outside Britain as the country readies to quit the European Union. Online sales currently account for about 45 percent of its business, while about 20 percent come from its international operations.
Reporting by Justin George Varghese and Samantha Machado in Bengaluru; Editing by Shailesh Kuber and Mark Potter