Domino’s Pizza Group PLC (LON:DOM) has finally agreed the disposal of its loss-making Norwegian business but it came at a cost - around £10mln, analysts say.
The fast-food chain had to pay two existing minority shareholders to take over Domino's Norway after posting an 18% quarterly drop in like-for-like sales.
The FTSE 250-listed company will dish out a total cash outlay of up to £7mln, in addition to funding the losses made until completion, targeted for May.
It will also have to pay £2.9mln in liabilities, such as costs related to shutting underperforming shops.
Analysts at UBS expect accounts to be hit by £10mln.
The two 'buyers' are Norwegian firm Pizza Holding and Icelandic company EYJA Fjarfestingafelag, which combined own 29% in the 56 stores across Norway.
Domino' has received their stakes in the Swedish business in exchange, making the group its only owner, paving the way for an easier future sale - or giveaway.
“The implementation of the disposal strategy will simplify the group and increase investor focus on the core UK business, which has delivered a resilient performance through a period of turbulence,” analysts at Peel Hunt said in a note.
Shares inched up 1% to 311p on Thursday morning.