Monsoon goes on shops spree

FAMILY-CONTROLLED fashion retailer Monsoon is buying 21 High Street shops from Dixons and axing its dividend to help fund expansion over the next few years.

Founder Peter Simon and his family control more than 75% of the shares and will bear the brunt of the dividend decision, which will save the company about £9m a year.

No price has been disclosed but the firm said the deal will increase its trading space in the UK by 12% and boost the number of Monsoon shops to 117 and Accessorize outlets to 135.

The shops, among the 106 underperforming sites being closed by the electrical retailer, will take Monsoon into 16 new locations in the UK.

The Dixons acquisition accelerates Monsoon's expansion and will push its capital expenditure sharply higher - to £33m for the current year against an average of £13.5m in the previous three years.

Spending is set to continue at the higher level for several years, hence the dividend decision.