Qatari investors are set to buy 100 percent of French department store Printemps in a deal likely to be worth up to 2 billion euros ($2.57 billion), official documents seen by Reuters show.
The tourist shopping hot spot has been the target of a joint bid by Italian businessman Maurizio Borletti allied with Qatari investors, but is also coveted by French retail arch-rival Galeries Lafayette.
Through Luxembourg-based company Divine Investments, Qatari investors are offering to buy Borletti Group’s 30 per cent stake in Printemps as well as the 70 per cent holding owned by Deutsche Bank’s real estate investment unit RREEF, according to official documents seen by Reuters.
When Borletti said last month it was in exclusive talks to acquire Printemps together with Qatari investors, it said it did not wish to sell its stake in the department store.
On Friday, Borletti Group declined to comment on the matter.
Borletti and RREEF bought Printemps in 2006 from French luxury group PPR for 1.1 billion euros ($1.41 billion).
Printemps now has 16 stores and employs about 4,000. Its 2011-12 turnover rose 13 per cent to 1.45 billion euros.
A source close to the talks told Reuters last month that RREEF and the Borletti Group were in exclusive talks to sell Printemps to Qatari investors for up to 2 billion euros.
Divine’s offer for Printemps includes a seven-year management contract with Borletti Management Group (BMG). It centres on “the provision of advice of a strategic and operational nature regarding the implementation of the business plan,” official documents seen by Reuters said.
Terms of the contract were not disclosed, but according to sources close to the matter, BMG’s management fee would be equal to 1 per cent of Printemps’s revenues. On top of it, would come a performance bonus linked to the department store’s sales growth.
The contract also stipulates that the current management team would remain in place and jobs would be preserved. The deal is set to be closed by the summer.