BERLIN — There's more consolidation under way in the European department store sector — and it's creating a Continent-wide player.
Arcandor AG, the renamed holding company of Germany's former KarstadtQuelle AG, said Wednesday it intends to create a European premium department store alliance with La Rinascente of Italy and Printemps of France.
According to Arcandor, the Karstadt Premium department stores, La Rinascente and Printemps have agreed to take cross stakes in each other's operations, with the aim of creating "a unique European department store portfolio and to leverage the high synergy potential."
There are currently three Karstadt Premium stores — in Berlin, Hamburg and Munich — led by KaDeWe in Berlin. A fourth Karstadt door in Frankfurt is currently being redesigned to fit the premium concept. There are a further 127 Karstadt department stores and Karstadt Sport stores located throughout Germany, which will not be part of the new alliance.
"The premium segment still has great growth potential both throughout Europe and beyond," said Peter Wolf, chairman of Karstadt Warenhaus GmbH, in a statement. "Together with our partners, we will rapidly expand the Premium Group further, ultimately setting a clear market leadership in Europe's luxury segment."
At the same time, Arcandor said it has signed a letter of intent to sell its 49 percent share in the real estate company Highstreet, as planned. Highstreet was formed last year in partnership with Goldman Sachs to sell the remaining real estate occupied by Karstadt department stores. The value of real estate and other assets owned by Highstreet is about 4.7 billion euros, or $6.9 billion. All dollar figures are converted from the euro at current exchange rates.
The Highstreet stake was bought by a consortium made up of the Deutsche Bank subsidiary RREEF, Pirelli Real Estate and the Borletti Group, which also owns La Rinascente and Printemps. Arcandor intends to rent back the sold real estate occupied by its Karstadt stores.
The real estate deal is linked to the planned European premium department store group. The RREEF/Pirelli/Borletti consortium is to take a stake of up to 25 percent in Karstadt's premium segment, with Karstadt possibly acquiring 25 percent of the La Rinascente and Printemps department store chains, Arcandor explained. Moreover, the parties envisage that representatives of each partner will occupy seats on each other's supervisory boards.
The planned alliance would create a rarity in Europe — a cross-border department store chain. Borlotti already blazed that trail with the acquisition of Printemps after it bought La Rinascente, creating a group that spans Italy and France. Adding a department store in Germany, Europe's largest economy, would further bolster the operation.
In another development, Arcandor has transferred a 51 percent stake in its catalogue operation, neckermann.de, to Florida-based Sun Capital Partners. The U.S. hedge fund paid no purchase price. Instead, according to Arcandor, "Maintaining 49 percent of the shares ensures that Arcandor will be able to enjoy returns of between $250 and $442 million (170 and 300 million euros), depending on business performance and market conditions, once the turnaround is completed and the company is subsequently sold or goes public."
Together, both parties founded a new company headquartered in the Netherlands, with each providing equity of 50 million euros, or $73.6 million.
“My personal philosophy to beauty is paying attention to oneself. I love to be outdoors, lots of fresh air, trying to take care of yourself as best you can. I always notice that comes through,” says Felicity Jones, the global face of @shiseido-owned @cledepeaubeauteus, which launches today. Head to WWD.com to read more about the actress’ love for beauty and how she prepared for her new role in “The Basis of Sex,” playing the young Ruth Bader Ginsburg. #wwdbeauty (📷: @dandoperalski)
For men’s fall 2018, @giuseppezanotti drew on elements from streetwear, sport, biker, combat and rock ‘n’ roll. Pictured here are a pair of shoes from the collection, featuring zippers, rhinestones, and silver hardware. Head to WWD.com to see a roundup of the accessories from Milan’s men’s fall 2018 shows. #wwdfashion (📷: Andrea Delb)
To celebrate the 25th anniversary of @ralphlauren’s snowboarding collection, the brand is mining its archives. The iconic brand is reintroducing vintage styles and dropping new designs for a color capsule that will be available in Ralph Lauren stores and @openingceremony on January 25. The capsule will consist of 10 pieces, including the Snow Beach Pullover, pictured here, which is a collector’s item that rapper Raekwon wore in Wu-Tang Clan’s “Can It Be All So Simple” video. #wwdfashion (📷: Tom Gould)
For @rochasofficial’s pre-fall 2018 collection, creative director Alessandro Dell’Acqua channeled the sophisticated and intriguing Catherine Denevue in the film “Belle de Jour.” Polished collarless coats, midi skirts, suits and ’60s graphic motifs were all featured in the collection, adding a sense of discreet luxury. See the rest of the photos on WWD.com #wwdfashion
“We tried to produce clothing of that couture quality, but the most daunting part was that we only had a matter of days [to do it],” said costume designer Lou Eyrich, who recreated Gianni Versace’s iconic looks for @americancrimestoryfx. Eyrich searched online retailers and vintage shops for original pieces from the design house and for @penelopecruzoficial, who plays Donatella Versace. Head to WWD.com to read how she created the Versace world. #wwdfashion
Only three months after her stellar debut catwalk season, @kaiagerber has inked her first big design collaboration –– with @karllagerfeld. The collection blends Lagerfeld’s Parisian chic aesthetic and the model’s signature West Coast casual style via RTW, accessories, footwear and more. The #KarlLagerfeldxKaia collection will launch in September with a series of events. Get all the details on WWD.com. #wwdnews #wwdfashion
Harrods plans to remove the famous statue of Princess Diana and Dodi Al Fayed from the bottom of the Egyptian escalators and hand it back to Mohamed Al-Fayed. “We are very proud to have played our role in celebrating the lives of Diana, Princess of Wales and Dodi Al Fayed at Harrods and to have welcomed people from around the world to visit the memorial for the past 20 years,” said Michael Ward, Harrods managing director. “With the announcement of the new official memorial statue to Diana, Princess of Wales at Kensington Palace, we feel that the time is right to return this memorial to Mr. Al Fayed and for the public to be invited to pay their respects at the palace.” More on the news, with reporting by @loreleimarfil, at WWD.com. #wwdnews