HILCO & DAWNAY, DAY GROUP COMPLETE THE ACQUISITION OF 74 DEPARTMENT STORES IN GERMANY FROM KARSTADTQUELLE AG
Hilco and Dawnay, Day Group today announce the completion of the acquisition of 74 department stores from KarstadtQuelle AG, the leading German department store and mail order company. The acquisition was first announced on 3 August 2005 and has been completed as agreed under a rapid timetable.
The stores are predominantly situated in central locations of medium-sized German cities, mainly in North-Rhine Westphalia and Lower Saxony. They sell a wide range of goods, including fashion, cosmetics, multimedia and home goods, in which segments they enjoy a market-leading position. The 74 stores, which in 2004 generated sales of €680m and employed 4,800 personnel, will undergo a refurbishment programme following completion.
Jeff Hecktman, Chairman and Chief Executive, The Hilco Organisation, commented,
“Our next step in this long-term investment will be to refocus the business on the needs of its local consumers and to complete the refurbishment programme which has just started. We see great potential in the smaller Karstadt stores and look forward to applying our extensive experience of retail situations in helping the existing management team to complete the turnaround of the business.“
Guy Naggar, Chairman of Dawnay, Day Group commented,
“Dawnay, Day is very pleased with this transaction which represents its first corporate acquisition in Germany and leverages its already successful experience of property investment in Germany. Dawnay, Day and Hilco are working with the management team at Karstadt Kompakt, led by Ralf Dettmer and Harald Foelkel, to ensure that the Kompakt business becomes a strong and modern retail business.”
Notes to editors
Hilco UK, whose parent Hilco Trading Co., Inc, is one of the most significant financial services and retail restructuring specialists in the US, has considerable operational expertise in restructurings involving creative restructuring and financing solutions for multi-site retail businesses in the UK and Continental Europe.
Hilco has been involved in some of the largest retail transactions so far this year, including the restructuring of the Courts, Allders and Littlewoods retail businesses, with a combined turnover in excess of £1bn. The Karstadt Kompakt transaction illustrates Hilco’s ability to work and partner with a range of advisors and financial institutions, including investment banks and private equity houses.
Dawnay, Day Group is a UK-based diversified financial services group whose businesses include private equity, property investment and finance, corporate and structured finance and asset management and securities trading. It has combined gross assets in excess of €2.9billion. The Group currently owns and/or manages over 400 UK and European commercial properties recently estimated to have a market value in excess of €2.1billion. Over the last 18 months, Dawnay, Day has acquired or has agreements in place to acquire retail commercial property in over 40 towns in Western Germany, worth close to €500m. In addition, the Group has recently launched Dawnay Day Carpathian PLC, a retail commercial property fund set up to invest €1billion in Central and Eastern Europe.
The Karstadt Kompakt acquisition represents the first German investment for Dawnay, Day Principal Investments, which is the private equity arm of Dawnay, Day Group.
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