The retailer said that French police were investigating a significant fraud operation at the warehouse operations of Fotovista. The fraud could cost the company up to£10 million.
DSGi said in a statement that several operatives at the warehouse and external individuals had been arrested. It added: 'The group anticipates that the financial impact of these issues will offset the expected profit contribution of the new businesses division to the group in the current financial year only.'
Separately, DSGi said it's Fotovista subsidiary had sold Primaphot and Maine Color for£15.2 million. The businesses have been acquired by a consortium, which includes directors of Fotovista and the managing director of Primaphot.
On March 26, the combined net asset value of Primaphot and Maine Color was£10.5 million. The net profit generated by the disposal amounts to about£7.9 million.
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