LONDON (Reuters) -British electricals retailer Currys said it will exit Greece after agreeing to sell its Kotsovolos unit to Greek power utility Public Power Corporation for an enterprise value of 175 million pounds ($214 million).
Shares in Currys were up 5.4% in morning trading Friday, paring losses over the last year to 24.3%, after it said it will use the proceeds, expected to be about 156 million pounds after costs, to cut debt and reduce its pension fund’s accounting net deficit.
The group said the disposal will simplify its structure enabling it to focus on its larger markets of the UK and Ireland and Nordics.
It will also strengthen its balance sheet, increase flexibility to invest and grow the business, and improve shareholder returns.
In September, Currys stuck to annual guidance as it reported falling sales in most markets for the four months to the end of August, but said UK trends were improving despite ongoing challenges in the Nordics.
“As a group, we’re focused on maintaining our encouraging momentum in the UK and Ireland and getting the Nordics back on track,” CEO Alex Baldock said.
Analysts at Liberum said the deal was an “excellent outcome” for Currys.
They said applying the achieved multiple of 14 times earnings before interest and tax (EBIT) to the rest of Currys suggests a valuation of more than double its share price before the deal was announced.
Public Power Corporation said the deal was a “transformation move, in a market that is changing globally” in an era of energy transition.
($1 = 0.8195 pounds)
(Reporting by James Davey in London and Angeliki Koutantou in Athens, editing by Sarah Young and Elaine Hardcastle)