Walt Disney, the US entertainment and media group, has abandoned the sale of its European retail chain after failing to agree terms for more than 100 stores across the region.
The company, which sold its 313 North American stores last year to US retailer the Children's Place, will retain its European outlets after seeing sales and profits increase last year.
Disney recorded a $64 million (€52 million) restructuring and impairment charge last year for the US stores, mainly for a fixed-asset write-down and warned of a further $40-$50 million working capital charge for the current fiscal year.
After the US sale, executives at the consumer products division pressed ahead with an auction of the European outlets, attracting offers from several trade and private equity buyers.
Disney said: "Following significant analysis, the company has decided that there is a greater strategic interest in retaining the stores and maximising their growth potential.
"All negotiations with interested parties have stopped."
The company had previously put a carrying value on the European chain of $36 million and said in its latest annual report that the stores had lease obligations of $206 million. Unlike the former US outlets, however, sales at the European stores have turned around after a decline in 2003.
According to Disney's accounts, the stores in Europe saw operating income rise to $17 million from $14 million in the year ending last September 30th, while sales rose 17 per cent to $326 million.
By contrast, the US retail chain saw revenues fall 2 per cent to $628 million - 11 per cent below the 2003 figure. In North America, the stores contributed $6 million profit in the last financial year, reversing losses of $101 million in the previous 12 months.
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