Dunelm collapses as founding Adderley family sells 10m shares

Dunelm shares fell on Tuesday after the homeware brand’s biggest investors sold part of their stake in the company.

Sir Will Adderley, who also serves as deputy chairman of Dunelm, sold 10 million shares in the company at a value of 1.140 each through his holding company WA Capital, a stock exchange filing shows.

This means WA Capital, which is also controlled by Adderley’s wife Lady Nadine, now controls a 37.6 per cent stake in Dunelm on behalf of the family.

Dunelm shares fell nearly 8 percent at the open before recovering to trade about 6.4 percent lower at 1,156pa mid-morning.

The group’s shares have gained more than 10 percent in the past 12 months and almost 40 percent in the past five.

Dunelm began life in 1979 as a curtain stall in Leicester market, run by Sir Will’s parents, Bill and Jean Adderley.

Will joined the family business in 1992 and has enjoyed two stints as CEO, having guided Dunelm through its 2006 IPO.

Dunelm is currently the most powerful player in the UK homewares market, with ambitions to control 10 per cent of the market share. Rivals John Lewis and Ikea each have a market share of around 4 per cent.

One of its main advantages is its “wide-ranging price architecture”. A simple Scandinavian leather sofa can be bought for £2,600 or a smaller “faux leather” version for £469.

This has helped it to combat discounters and attract a clientele of “all ages, incomes and geographic groups”, boss Nick Wilkinson said earlier this month.

UBS analysts maintain a buy rating on Dunelm shares with a target price of 1,410p.

They say: ‘We expect (Dunelm) to benefit from a structurally competitive offering, driving profitable share gains in a recovering UK homewares market.

‘Dunelm has already demonstrated a consistent track record of share gains, earnings growth (pre-tax) and shareholder returns even in the most challenging environments for the sector.’