Couple to cash in £120m from retail empire that grew out of market stall

A husband-and-wife team who built up a homewares retail giant from a single Leicester market stall are cashing in £120m from floating their business on the stock market next month.

Bill and Jean Adderley, who with their son William own Dunelm Mills outright, yesterday announced plans to seek an initial public offering for the curtain-to-kitchenwares group that they have built up over the past three decades.

The family is selling 30 per cent of its stake in the business, but will remain the dominant shareholders by holding on to the rest of the stock. Following the initial public offering, Jean, who is 60, will own 7.5 per cent, her husband, who is 58, will own 50 per cent, and Will, who runs the group, will have 12.5 per cent. The family is not issuing any new shares in the group.

Jean and Bill started out selling curtains near Gary Lineker's family vegetable stall in Leicester market in 1979. They opened their first high-street shop in Leicester in 1984.

Analysts valued the 82-store retailer, which claims to offer shoppers the cheapest and widest selection of homewares on the market, at between £350m and £400m. UBS is handling the IPO. The group has a strong trading record, growing its underlying profits by 8.6 per cent to £46.5m in the year to 1 July on sales up 12 per cent to £315.2m.

Will Adderley, 34, who has run the business since leaving university, said the listing was the next logical step in the group's evolution. "The discipline of being listed will make us stronger," he said.

He added that the company did not need to raise any new money because it threw off enough cash to cover its expansion plans, which envisage opening a further 70 stores throughout the UK. At the moment the group, which is mainly found on retail parks, has a strong north-western bias, with just two stores inside the M25 and none on the south coast.

Two years ago it hired Geoff Cooper, the chief executive of Travis Perkins, as its chairman. Bill Adderley is one of two other non-executive directors, although Jean has stepped back from the business entirely.

Will Adderley said his parents were not planning a big spending spree. "The vast majority of their wealth was tied up in Dunelm and they thought it was sensible to change that. They have no big plans, no blow-out. They haven't got a yacht on order," he said.

The family hopes that floating Dunelm will enable the group to follow in the footsteps of some of the country's most successful retailers such as Tesco, which had similarly humble beginnings. Mr Adderley said that being listed would raise Dunelm's profile, bring in some free advertising and hopefully some new customers.