NOT SO FAST: The much-publicized deal by the Spanish retailing giant El Corte Inglés to sell a 10 percent stake to a high-profile Qatari investor has hit a bump.
According to press reports, Ceslar SL, an investment group representing minority shareholders and family members of the store’s founder, has voiced concerns around the valuation of the company in the deal.
As reported last month, the multibillionaire and former Qatari prime minister and foreign minister Sheikh Hamad Bin Jassim Bin Jaber Al Thani plans to buy a 10 percent stake in Spain’s largest department store chain with a personal investment of 1 billion euros, or $1.11 billion.
All figures have been calculated at current exchange rates.
The retailer is privately owned, with the majority still in the hands of the founding family. A 35 percent stake is held by the Ramón Areces Foundation, which promotes and furthers research, education and culture in Spain. The Qatari investment would mark the first time that El Corte Inglés opened its shareholding to a foreign investor.
The money was set to be used for international expansion and paying down debt. Shares will come from ECI’s treasury stock, and Al Thani will have a seat on the board of the food, clothing and household goods retailer.
According to a statement from Ceslar, published in part by Reuters, the investors called the sale “an unacceptable loss of value for shareholders.”
It “leaves El Corte Inglés well below all the valuations that have been carried out,” said Ceslar, which holds nearly 10 percent of the company. Ceslar added that the buildings owned by El Corte Inglés were valued at 18 billion euros, or $20 billion, by property experts in 2013.
Ceslar SL and El Corte Inglés did not respond to requests for comment. Representatives of Al Thani’s investment company Primefin could not be reached for comment.