Britain's biggest carpet retailer Carpetright is moving into Europe after agreeing a £32.5 million deal.

The group, which owns 347 shops in the UK, is buying a 50 per cent stake in Carpetland, a 92-strong carpet shop chain in Belgium, Holland and Luxembourg, for £9.7 million.

Under the deal, it will take management control of the joint venture and also has an option to snap up the remaining 50 per cent within the next six years.

It has also bought certain properties from which Carpetland operates for £22.7 million.

Carpetright said it will stock the stores with its ranges and refurbish the sites over the coming months.

Chairman and chief executive Lord Harris of Peckham said: "We believe there is a significant opportunity for Carpetright in selected European markets."

The deal came as Carpetright showed a jump in profits and sales in its core UK business over the last year.

Pre-tax profits for the year to April 27 rose 17.8 per cent to £52.5 million, while sales were up 12 per cent at £361.5 million.

Like-for-like sales, which strip out new store openings, rose 6.7 per cent while margins were also up.

Carpetright is also expanding domestically and expects to open 32 new stores this year.

The group also said today that finance director Shena Winning would step down for "personal and family" reasons. She will be replaced by Darren Shapland, currently finance director at Superdrug.

Lord Harris said the deal gave Carpetright a fantastic store portfolio.

He has decided against rebranding the stores as the Carpetland name is well established, having been around for 30 years.