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PARIS — Qatar is on the verge of gaining another prestigious fashion foothold in Europe.
This story first appeared in the February 21, 2013 issue of WWD. Subscribe Today.
Having already snapped up London department store Harrods in 2010, the cash-rich Gulf state could soon boast French department store chain Printemps in its portfolio.
Deutsche Bank’s real estate asset management division, RREEF, and Borletti Group —the joint owners of Printemps — said Wednesday that RREEF has entered into exclusive negotiations with Borletti Group and unidentified Qatari investors to sell its stake.
Speculation is likely to focus on the Qatar Investment Authority and its Qatar Holding LLC arm, which have invested in a slew of luxury and retail stocks in the past few years.
The Arab state has a 1.03 percent stake in LVMH Moët Hennessy Louis Vuitton and an 8.7 percent share in Tiffany & Co. It has also bought real estate including a historic building on Place Vendôme, a flagship retail complex on the Champs-Elysées and hotels including the Martinez in Cannes, France.
Meanwhile, Qatar Luxury Group has signed a lease on a boutique on Avenue Montaigne for the upcoming launch of Qela, its first homegrown luxury brand. And Mayhoola for Investments, an investment vehicle backed by a private group from the Middle Eastern monarchy, has snapped up Italy’s Valentino Fashion Group SpA.
Speculation around a change in ownership of Printemps has been building in the last few months, with RREEF said to be looking for a buyer for its 70 percent stake, but Borletti Group — run by former La Rinascente chairman Maurizio Borletti — is keen on holding on to its 30 percent participation.
The duo bought the Printemps chain for $1.33 billion from French conglomerate PPR in 2006 and has since invested millions in shifting the store upmarket.
Under the terms of the purchase deal, RREEF had planned to sell its stake by 2014 at the latest, with Borletti Group having a priority claim to the stake, according to sources familiar with the transaction.
Any sale will be subject to approval by the works council of Printemps and competition authorities.
Potential buyers for RREEF’s stake were said to include rival department store chain Galeries Lafayette, whose Paris flagship is a stone’s throw away on Boulevard Haussmann, making the area a top draw for tourists visiting the French capital.
French business magazine Challenges reported in December that Galeries Lafayette was ready to pay 1.6 billion euros, or $2.14 billion at current exchange, to acquire the retailer. Officials at the family-owned company had no comment on the rumors.
Printemps has 15 stores in France in addition to its Paris flagship and employs around 4,000 people. It plans to open three new stores by 2015, marking the first additions to its retail network in more than 30 years.