US home giants in talks with Kingfisher

KINGFISHER chief Gerry Murphy held talks with American home improvement groups Lowe's and Home Depot last week amid speculation about the British DIY giant's future in the wake of a profits warning.

Insiders confirmed that two separate meetings took place, but they insisted that the meetings were planned long before Wednesday's profits warning. They also played down speculation that the talks were a prelude to a bid for Kingfisher.

Kingfisher's British operation, B&Q, has seen a sharp sales slowdown, but the company is seen as a likely bid target for Home Depot or Lowe's.

Both companies would see buying Kingfisher as a quick way to secure a major presence in China, where the UK group is expected to have 50 outlets within 12 months. It is in the process of converting its Chinese stores to the B&Q format.