2006 was an important year for Le Printemps, the french department store. It was the year that PPR group sold the luxury department store. Financial speaking, the trade was pretty complex. Le Printemps was sold for 1.07 billion euros to a financial group based in Luxembourg. A subsidiary of Deutsche Bank, grouping several investors take over 70% of the capital. The other 30% is taken by the Borletti group. This group, also based in Luxembourg gathers several investors: The Borletti family, several italian fortunes and companies like Dassault, Allianz..
Basically, all the profits of the parisian department store ended up in Luxembourg in the past 6 years. Now, the breaking news is the strong possibility for Le Printemps to be sold again. And again, things look very “dark”.
Officially, the Bortelli group does not wish to sell its participation, at the contrary. They even made a proposition of 650 million euros to purchase the other 70%. This offer seems ridiculous facing the 1.6 billion euros that French Properties proposes. But who is French Properties? Take a deep breath and here we go: French Properties it is a subsidiary of a Dutch fund called Mayapan. Mayapan is owned, personally, by Cheik Al Thani – Qatar. French Properties offers 11 times the financial result of Le Printemps, which means they are determine to buy it.
While all these high-finance people struggle to find the most profitable operation, one important question will be: What is going to happen to Le Printemps?
According to certain sources, the Qatar group has ambitions to transform the parisian department store into a huge luxury shopping mall. Most of the other Printemps stores would be sold (not enough potential) and this could be the end of the popular department store. Only Brands staff would work in the different shops in shops, and very few people would work directly for Le Printemps.
The strange part of all this story is that consistent and massive investments were done over the years to raise up the luxury level of Le Printemps. New store, a cutting edge communication and image, world class events, especially for Christmas… In comparison, Les Galeries Lafayette looked old and boring.
Why so many investments for a programed disappearing?
Wait and see…
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