MILAN — Changes are afoot at La Rinascente under its new owner, Thailand-based Central Retail Corp., which took control of the Italian department store chain in May 2011 and is planning a global expansion.
La Rinascente’s current chief executive officer, Vittorio Radice, has been promoted to vice chairman. He will also be in charge of the international development of luxury department stores under the Central Retail umbrella. Radice, who joined the Italian chain six years ago, is known for rejuvenating the British department store Selfridges.
Alberto Baldan, currently La Rinascente’s managing director, will become ceo.
Central Retail is focusing on international development of “high density” luxury department stores modeled after La Rinascente’s jewel in the crown, its Piazza Duomo flagship here, while continuing the repositioning and development of the retailer in Italy.
Central Retail chairman Sudhitham Chirathivat said the acquisition “has raised both the profile of La Rinascente in Asia and Central Group outside of Asia. We believe Vittorio Radice is best suited to capitalize on this momentum for our international expansion strategy.”
Chirathivat acknowledged Italy’s, and Europe’s, difficult economies, but said he was confident in the future, believing the expansion of La Rinascente will “contribute to local economies by investing in building new stores, creating jobs and bringing new product to its customers. Italy is well positioned to benefit from the growing numbers of Asian tourists traveling to Europe for luxury shopping. Therefore, we have no doubt that the Italian economy and its retail market will recover and continue to grow strongly in the future.”
He concluded that the store has achieved targeted sales for 2011, expecting sales to “continue to grow.” Last year, Radice said he hoped La Rinascente would reach sales of 300 million euros, or $413.6 million, in 2012.
Radice said he was “extremely happy with the results” of La Rinascente’s repositioning, but said that “because of the lengthy procedures to obtain planning consents and trading licenses in the Italian market, we are looking overseas to accelerate our expansion.”
Central Retail is targeting Europe and Asia.
Baldan added that he hoped the “long-awaited stores of Rome and Venice” will open soon and noted that the group continues to invest in its existing stores “to keep the company among the best in retail.”
The new owner of La Rinascente department stores is tapping into increasingly wealthy tourists from emerging markets, with plans to promote the chain internationally, leveraging Italian design and quality.
With sales of $4 billion, the Bangkok-based Central Retail owns 41 stores in Thailand, and three in China, and its business also includes property, hotels and restaurants.
Central Retail took control of the retailer for 260 million euros, or $358.4 million at current exchange, 11 times the store’s 2010 earnings before interest, taxes, depreciation and amortization. Previous shareholders included real estate developer Prelios with a 20 percent stake; investment fund Investitori Associati (46 percent); RREEF-Deutsche Bank Group (30 percent) and Tasso, controlled by chairman Maurizio Borletti (4 percent). Central Retail said it planned to invest 10 million to 15 million euros, or $13.7 million to $20.6 million, a year in the refurbishing and renovations of La Rinascente’s 12 stores. Next year, the Milan unit will complete its renovation plan initiated in 2006.