On Monday, the board of Selfridges formally recommended an offer by Weston’s company Oxford Acquisitions Ltd., valuing the department store chain at approximately $965 million. In addition, OAL plans to assume Selfridges’ net debt of $49 million.
And Selfridges wasn’t the only department store attracting interest Monday. In a further heating up of takeover activity in the once-maligned sector, Debenhams plc said it had received an indicative proposal from the venture capital group Permira, valuing the company at about $2.4 billion. Permira is backing Debenhams chief executive Belinda Earl and her management team, which has offered approximately $6.84 per share for the 90-store chain. Debenhams did not release any further details, and Earl could not be reached for comment.
Weston’s high-end retail holdings include Holt Renfrew in Canada and Brown Thomas in Ireland, while the British side of the Weston family owns London’s gourmet emporium Fortnum & Mason. Galen Weston’s company Wittington Canada, a private holding, also controls George Weston Ltd., one of the largest food processing and food distribution companies in North America.
According to a joint statement issued by Selfridges and Oxford Acquisitions, Weston plans to offer up to $6.33 per share, comprised of $6.24 in cash for each share and a further 9 cents per share as a final dividend for the year.
The offer of $6.33 a share represents a premium of about 60 percent over the closing price of $3.95 on April 8, the last day prior to the start of the bidding process for the retailer. All figures have been converted from the pound at current exchange.
Weston said in a statement that Selfridges sat well within his empire: “There is a good fit between Selfridges’ distinctive approach to the retail experience and Wittington Canada’s considerable experience in finding creative and appropriate ways to grow such concepts,” he said, adding that he planned to work with existing management led by chief executive Peter Williams, who replaced Vittorio Radice earlier this year and who himself was leading a management team interested in buying Selfridges.
Williams could not be reached for comment on Monday as to his plans, but past newspaper reports in Britain indicated he would stay on even if he didn’t win the bidding.