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Redundancies begin at Comet with 60 stores at risk 21 March 2012

Comet Group has put dozens of staff into consultation for redundancy and “may” close 61 stores as part of its drive to cut costs in the volatile consumer market.

The retailer’s new parent – OpCapita – has called meetings with landlords to discuss the terms of rental leases and has refused to rule out possible store closures.

There are believed to be around 30 – 35 poorly performing stores that the group wants to exit while redundancy notices have already been handed to staff in support roles around the country.

The company has been carrying costly overheads in recent years arising from property liabilities and labour costs.

Today’s news comes just months after Kesa Electricals sold the troubled retailer to entities of private equity group OpCapita for £2.

OpCapita subsidiaries Hailey Holdings and Hailey Acquisitions snapped up the group which included the Triptych Insurance subsidiary.

As part of the deal, Kesa agreed to pay a £50m dowry, with the new company retaining the liability for the group’s defined benefit pension scheme.

In the trading statement for the first half of 2011, Kesa said Comet had taken a financial hit during the six month period due to costs associated with merging operations at its service centre and logistics divisions.

As a result, like for like revenue fell by 18.6%. It was confirmed that Comet would post a loss of around £22.6m (€26m) for the first half of the year.

Comet’s public relations agency said it would not be issuing an official statement on the matter.

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