Best Buy to End Its 8-Year Ownership of Five Star Stores in China

In recent years, Best Buy has closed dozens of Five Star stores in China and vowed in SEC filings to "continue to review our portfolio of stores across all geographies." As it stands, Best Buy by FY 2016 Q1 will have divested itself completely of the Five Star chain in China through a definitive agreement to sell the business to the Jiayuan Group, a prominent China-based real estate firm, Best Buy said in a Thursday announcement. It didn’t disclose terms, but in 2006 Best Buy paid $180 million to acquire an unspecified majority interest in Jiangsu Five Star (see 0605150137) and now operates 184 stores in China, all under the Five Star brand. "The sale of Five Star does not suggest any similar action in Canada or Mexico," CEO Hubert Joly said in a prepared statement. "Instead, it allows us to focus even more on our North American business. We will also continue to invest in and grow our China-based private label operations, with brand names that include Dynex, Insignia, Modal, Platinum and Rocketfish."