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Kingfisher sells stake in B&Q China business for $219 mln

A customer shops at a B&Q store in south London June 4, 2008. REUTERS/Alessia Pierdomenico

LONDON (Reuters) - Home improvement group Kingfisher said on Monday it had agreed to sell a 70 percent stake in its loss-making B&Q China business to Wumei Holdings Inc for 140 million pounds ($219 million).

The agreement follows Kingfisher's announcement in March of its plans to look for a strategic partner to help develop its B&Q business in China, which is made up of 39 stores and employs 3,000.

“I am delighted to have found a strong retail partner who will help us to release the financial value of our business in China," said Véronique Laury, who succeeded Ian Cheshire as Kingfisher's chief executive on Dec. 8.

"This will enable us to focus our financial resources and management talent on the large and attractive European home improvement market," she said.

Kingfisher, which trades as B&Q and Screwfix in Britain and Castorama and Brico Depot in France, is Europe's biggest home improvement retailer.

Beijing-based Wumei has a retail network comprising around 650 supermarkets and 10 department stores in northern, eastern and western China.

The deal is conditional on Chinese Ministry of Commerce approval and, if approved, is expected to close during the first half of 2015.

Shares in Kingfisher, down 15 percent so far this year, closed Friday at 342.2 pence, valuing the business at 7.65 billion pounds.

(Reporting by James Davey; Editing by Neil Maidment)