Central Group Takes Control of Selfridges
Central said it has exercised its right to convert a loan and will become a majority shareholder in the store, which it had purchased alongside Signa Holding in 2021.
LONDON — Thailand's Central Group has taken control of Selfridges, which it had purchased in late 2021 alongside its joint venture partner Signa Holding.
The move follows the resignation of Signa chairman René Benko and the Austrian property giant's restructuring by German specialists Arndt Geiwitz.
Central Group said Tuesday in a brief statement that it has exercised its right to convert a loan, provided by one of its subsidiaries to the Selfridges group, into equity. The move is subject to relevant regulatory and antitrust approvals.
As a result, Central Group said it will become the majority shareholder in the retailer and gain control of the joint venture company the oversees Selfridges Group.
The group comprises the Selfridges stores in the U.K., Brown Thomas and Arnotts in Ireland, and De Bijenkorf in the Netherlands.
Central Group said the move “solidifies” its position as an owner-operator of the largest European luxury department store group, “offering customers the best curation of brands, merchandise and extraordinary experiences.”
As reported last week, Benko quit as chairman of Signa, which had a 50 percent stake in Selfridges, and the board handed the company to the restructuring specialist Geiwitz.
The Austrian property developer had run into trouble due to a perfect storm of rising interest rates, sinking real estate values and poor management.
Geiwitz has also taken over the chairmanship of the shareholders' committee of Signa Holding.
Benko said, “Arndt Geiwitz has the full trust and confidence of all Signa Holding shareholders and will organize the restructuring of the entire Signa Group out of his role. Given the current situation, this is the best solution for the company as well as its partners, investors and employees. What's important now is to restore trust, and I want to play my part in that.”
He added: “Signa's property portfolio is, and remains, unique. I'm absolutely certain that the company has a very bright future. All stakeholders are called upon to support Signa at this time. I am fully prepared to do so.”
Signa has also engaged other external consultants, including Rothschild & Co., to help carry out a “thorough review of all business areas, develop measures and draw up an integrated concept for the group.”
Geiwitz said Signa needs “calm and order at this time. We will approach these important tasks prudently and rationally. The aim is to find long-term solutions, and that's why it is both responsible and necessary to initiate a comprehensive consolidation for the company now.”
As reported, when Signa's troubles surfaced earlier this month, Central
Group said it was standing by the luxury retail properties it co-owns with Signa: the Selfridges group of stores in the U.K., Ireland and the Netherlands; KaDeWe in Germany, and Globus in Switzerland.
It remains unclear whether Central will also look to take control of KaDeWe and Globus.
Central Group has described itself as a “proven long-term owner and investor in all of its businesses.” It said earlier this month that “regardless of the position of our JV partner,” it was committed to supporting all of its European luxury stores.
“We will ensure that they have all the backing they require to continue to operate as normal,” Central said.
KaDeWe and Selfridges issued similar statements saying their businesses would not be impacted by Signa's woes, and they had the full support of Central.
Two years ago, Signa and Central Group joined to acquire Selfridges for a reported 4 billion pounds. They each took a 50-50 stake in the retailer, which they later split into two businesses, a property one and a retail one. The latter pays rent to the former.
The deal spanned the Selfridges Group's portfolio of 18 department stores, including Selfridges in London, Manchester and Birmingham, England; de Bijenkorf in the Netherlands; Brown Thomas and Arnotts in Ireland, and their associated e-commerce platforms and the properties in London, Manchester and five locations in Ireland.