ARNOTTS chairman Nigel Blow has expressed his fears for the future direction of the legendary Dublin department store following the latest developments concerning the sale of the retailer's €230m bank debt by the IBRC's special liquidators.
Commenting on reports that US investment giant Apollo was now in the final stage of negotiations to secure Arnotts's IBRC loans at a price believed to be about 40 cent in the euro of their face value, Mr Blow voiced his concerns to the Sunday Independent both for the store's brand and for the jobs of its employees.
While there had been strong speculation that Fitzwilliam Finance Partners, a company headed up by solicitor and developer Noel Smyth and backed by Canadian billionaire Galen Weston's Selfridges, would manage to acquire the €230m in loans and gain effective control of the Arnotts debt, the late arrival of Apollo into the bidding war has added to the uncertainty surrounding the future of the store's brand.
The so-called 'Smyth and Weston' team looked to have stolen a march on their rivals last week after buying Arnotts's other outstanding debt of €140m from Ulster Bank. Mr Smyth was told on Friday that his firm's bid, in a team-up with the Brown Thomas-owning Weston retail dynasty, had been unsuccessful.
Reacting to Apollo's apparent eleventh-hour coup, Mr Blow -- whose management team was also involved in the bidding for Arnotts's IBRC loans with British retail investor Meyer Bergman -- said: "It looks like Apollo are in the driving seat at the moment. There's nothing been confirmed 100 per cent and obviously we haven't been told, and Meyer Bergman haven't been told they've been unsuccessful, so I think the special liquidators are keeping a couple of people in play. But I do accept that it looks like Apollo are in the driving seat, so it's theirs to lose.
"It's a situation we hadn't anticipated. Equally, I don't think it's a situation Noel Smyth and Selfridges would have anticipated or wanted either," he said.
Mr Blow described as "premature", however, speculation that Selfridges might involve itself in a joint venture with Apollo, in which they would look to work together as Arnotts joint owners along with the retailer's management.
"I think that speculation might be a little bit premature. I can't imagine those discussions have taken place given how fast all this has happened. I think all parties will want to have the deal inked and done, and then they'll have to communicate with each other," he said.
The Arnotts chairman cautioned that the acquisition by Selfridges and Apollo of the Dublin department store's debt still required the approval of the Competition Authority.
"My understanding is that until competition approval is actually gained, then effectively Ulster Bank and the IBRC continue to have control of the business," he said.
Asked what impact the current struggle for control of Arnotts might have on the store's operations were it to remain unresolved for a protracted period, he added: "If this rumbles on for too long, then obviously keeping the show on the road for us as a board becomes more difficult."
Of his own future with the company, Mr Blow said: "I've been involved in Arnotts for a good few years now and I'm very emotionally attached to it as a business. My duty with the rest of the board is to make sure the outcome is as good as it can be for the company, the staff, the Arnotts brand and its customers. We would have a lot of concerns about that.
"We need to make sure there aren't significant job losses, which there could be. I think it's very important for Ireland that the Arnotts brand keeps going. Personally, I'll stay involved as long as Arnotts needs me to be. But I can't really speculate on that until we know the outcome."
Apollo's spokesman could not be reached for comment last night, while a spokesman for the IBRC's special liquidator declined to comment.