MOTHERCARE AUSTRALIA is to enter administration.
Baby- and children-centric retailer Mothercare owned a minority shareholding in associate Mothercare Australia, and the associate was in the process of a sale to the Myler Family Company, but the deal fell through.
Mothercare made a provision of £10.6m to cover the remaining value of its investment and other receivables due from its subsidiary.
Mothercare Australia represents some 7% of Mothercare’s international retail sales. Total international sales for the group in 2012 were £672.4m. Its 2012 results saw it report a £2.8m impairment of investment in its Australian business.
The expected impact on Mothercare’s profits is “minimal”, it said in a statement to the stock exchange, and “does not change our overall view of International profitability going forward”.
Its share price fell 6p to 323p in this morning’s trading, valuing Mothercare at £286.33m by market cap.
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