Retail round up The Sunday Papers
Jimmy Choo closes in on £550m deal, Morrisons gears up to bid for Iceland, BetFred offers advisory role to racing in bid to win Tote, Walmart sets up London team to lead European drive, Value shops eye Mothercare sites, Westfield expands into Europe, New Waterstones boss seeks to allay closure fears, Triumph for Bolland
Labelux, the European luxury goods group, is in pole position to buy Jimmy Choo, the shoe maker founded by one-time It-girl Tamara Mellon, for a price believed to be in the region of £550m. Labelux, whose other investments include retailer Bally and designer Derek Lam's ready-to-wear business, was founded by Austria's Benckiser family, which also owns a 15pc stake in Reckitt Benckiser and perfume maker Coty. The deal, which is expected to be announced as early as this week, will be the fourth time the business has been sold in the 15 years since it was founded, and will see Ms Mellon roll forward her equity stake in the company and retain her role as chief creative officer. The expected price is almost three times the amount owner TowerBrook paid for the business four years ago.
Morrisons is on the verge of appointing advisers for a potential £1.5bn bid for supermarket chain Iceland. Sainsbury's and Asda are understood to have also expressed interest to join the auction process, which will kick off formally over the summer, though this could be for a limited number of stores. Private equity firm Clayton Dubilier & Rice, which recently appointed former Tesco chief Sir Terry Leahy, is among a clutch of private equity firms that have also contacted advisers. Apax, Lion Capital and BC Partners are also thought to have requested sales material. Iceland is being sold by officials winding up Landsbanki, the collapsed Icelandic bank that took control of the chain in 2008 from Baugur. They have appointed UBS and Bank of America Merrill Lynch.
BetFred has launched an 11th-hour attempt to get the racing industry to support its bid of around £200m for the state-owned Tote by revealing plans for an advisory board with seats for the racing industry. Mirroring plans by rival Sports Investment Partners (SIP), which has already promised to give two board seats to industry representatives, the betting shop chain said that if successful it intends to set up what it called the "Tote Development Board". The board would be chaired by BetFred – which was founded 44 years ago by 67-year-old owner Fred Done – but would give seats to representatives from the race course industry and would aim to align the bookmaker with the commercial interests of racing.
Independent on Sunday
Walmart is setting up a London team to launch into Europe. The $193bn US retail giant, which is finalising the details of buying a South African grocery chain this week, will bring a team to London – close to Heathrow airport – to look at opportunities for European mergers or takeovers. Walmart, which also owns UK supermarket chain Asda, first entered mainland Europe in 1997 when it bought German hypermarket chain, Wertkauf, but the move was not as profitable as hoped and it pulled out by selling the chain in 2006. But now European expansion is back on the cards as there is less growth for Asda in the UK and Walmart's home market is also stagnating.
A handful of companies are circling Mothercare to buy small batches of stores from the struggling childcare retailer. It is thought a number of pound shops and card shops including Card Factory are hoping to take over the stores. Mothercare confirmed last week that it was to close more than 110 shops and cut the rent on 40 stores by March 2013 – as forecast by The Independent on Sunday earlier this month. It is moving out of the high street for out-of- town sites. Value and pound shops are scooping up stores from less successful retailers. Ernst & Young, the joint administrator of DIY chain Focus, has sold 11 stores to value retailer B&M Bargains.
Westfield, the world's biggest shopping centre company, is in talks to expand into Europe. The Australian company, which is behind the massive shopping centres in London's Shepherd's Bush and Stratford, is bidding against rival property developers for projects in Belgium and Italy. The Brussels-based scheme will be called Uplace Machelen. In Italy Westfield is in talks with Gruppo Percassi to develop a shopping centre to the east of Milan.
Mail on Sunday
The incoming boss of Waterstone’s this weekend sought to allay the fears of staff by distancing himself from speculation that he would close swathes of stores. On Friday, James Daunt’s business partners, Tim Waterstone and Alexander Mamut, agreed to acquire the bookshop chain from HMV Group for £53 million. The deal could take another six weeks to complete and shareholders are expected to vote next month. Daunt admitted that some Waterstone’s stores in poor locations might shut, but he added: ‘This is not the Visigoths of private equity coming in to restructure the business and sell it on for a quick profit.
Marks & Spencer chief executive Marc Bolland is this week expected to reveal that the group has defied the gloom to report profits up by as much as 15 per cent to £725 million. He is also likely to please his shareholders by increasing the dividend by ten per cent to 16.5p. The performance will be far stronger than many analysts had predicted .
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