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Friday, 2 November, 2001, 14:17 GMT
Marks & Spencer sells Spanish stores
Marks & Spencer shop in Manchester
Marks & Spencer will announce interim results next week
Marks & Spencer has sold its nine Spanish outlets to Spain's largest retail chain El Corte Ingles.

The move almost completes the UK retailer's plan to cut costs by winding up its mainland European operations.

The company now has just four European stores left, down from 36 this time last year. Its remaining stores are in Portugal, the Netherlands and Luxembourg.

Under today's deal, all of M&S' 800 Spanish employees will retain their jobs.

"We are pleased that we have reached an agreement with El Corte Ingles to acquire our stores in Spain, and to offer jobs to our employees, which has been a priority objective," said M&S international director David Norgrove.

Staff protests

Earlier this year, M&S sold off its Belgian stores and sacked the entire Belgian workforce when it failed to find a local buyer - a move that provoked mass protests in the country.

Similar protests erupted in France until retailer Galeries Lafayette came forward to buy its French stores.

The company faces possible legal action from former employees for breaching European Union legislation obliging employers to consult their staff over major strategic decisions.

M&S did not reveal the purchase price agreed with the Spanish retailer.

Results due next week

However, the company has set aside 224m to cover the costs of its withdrawal from continental Europe.

Any expenditure above this figure is to be announced along with the retailer's interim results next week.

Analysts are predicting that the firm will announce profits growth for the first time in nearly two years.

Shares in M&S rose nearly 2% on the London Stock Exchange on Friday.

See also:

31 Oct 01 | Business
M&S in 348m property deal
16 Oct 01 | Business
M&S sells French stores
09 Oct 01 | Business
M&S shares test two-year highs
04 Oct 01 | Business
Promising start for new M&S range
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