Primark to become stand-alone company
Primark is being spun off.
In an expected move, Associated British Foods (ABF) plans to separate its foods business (FoodCo) from its retail business, Primark, which is known for its budget prices and on-trend fashions. The “demerger” is expected to take effect before the end of 2027 and is subject to approvals and tax clearances, according to a Tuesday press release.
The ABF board said it was confident in the long-term prospects of both businesses, noting that the “demerger” will deliver a number of benefits to each. Both of the businesses which will remain publicly listed and majority owned by the Weston family's Wittington Investments.
Following the split, Eoin Tonge will remain CEO of Primark (after serving as interim chief for nearly a year, he was appointed to the role on a permanent basis in March). George Weston, chief executive of ABF, will become CEO of FoodCo.
Primark currently has 486 retail stores across 19 markets. It will open its 40th U.S. location on May 8 when it unveils its Manhattan flagship.
In the press release announcing the move, ABF described Primark as a “global disruptive leader in apparel, combining clear price leadership with differentiated quality and exciting fashion in prime locations.” It noted that the company has “end-to-end control of innovation, design, licensing, buying and quality, underpinned by industry-leading standards of sustainability and ethical sourcing.”
Results
For the 24 weeks ended Feb. 28, ABF said Primark sales grew 2%, with new store openings contributing 4% to growth. In the U.K., same store sales rose grew 1.3% and Primark gained market share “in a difficult retail environment, reflecting strong progress to reenergize our customer proposition.”
Looking ahead, the company sounded. warning note about the impact of the war in Iran on Primark’s performance.
"We are managing the impacts of the Middle East conflict," Weston said. "Given what we know today, we expect the cost consequences in 2026 to be manageable. However, there is a risk to Primark sales if the conflict persists and consumer spending deteriorates."
