Dixons Retail said it would be paying EUR 69 million to Germany-based mutares AG to exit e-commerce business PIXmania. Dixons is the second largest retailer of electrical goods in Europe while mutares is an industrial holding firm. PIXmania was established in 2000 and sells consumer electronics and other products online.
Dixons announced that mutares had given an irrevocable offer to buy PIXmania. Under the terms of the transaction, Dixon would give the cash to assist mutares in developing the e-commerce site. Dixon's Chief Executive Officer Sebastian James said, "In order to succeed as a pure play e-tailer, PIXmania needs a different kind of entrepreneurial vigour."
Sales of PIXmania slipped to 28% in the first quarter. This also brought down the performance of Dixons. Dixons continued to struggle in Europe's difficult markets. Reuters reported that electrical retailers like Dixon had become vulnerable since the goods they sell are considered discretionary. Fierce competition from internet retailers and supermarkets in their niche also contributed to retailers' woes.
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