PARIS, July 19 (Reuters) - French music and book retailer Fnac Darty said on Wednesday it had agreed to sell its Brazilian business to local bookstore chain Livraria Cultura.
Fnac Darty said it will license the Fnac brand to the new unit and carry out a recapitalisation to help the new entity improve its market position.
It did not disclose the size of the recapitalisation nor provide other details of the deal.
Fnac’s Brazil arm is among several Brazilian appliance and consumer electronics retailers up for sale after their traditional set-up of brick-and-mortar outlets with lots of floor space and slow inventory turnover has become increasingly unsustainable in Brazil’s worst recession on record.
The completion of the deal is expected in the coming weeks.
Fnac’s presence in Brazil dates back to 1999. Currently, the loss-making unit runs 12 stores in Brazil and a website, employing 550 people.
The Brazilian unit generates less than 2 percent of Fnac’s 7.4 billion euro ($8.52 billion) annual sales.
$1 = 0.8640 euros Reporting by Dominique Vidalon; Editing by Sudip Kar-Gupta and Adrian Croft