Decision on Anglo, Ulster Bank takeover of Arnotts due this week
OFFICIALS will consider any objections to the application by Anglo Irish Bank and Ulster Bank to take over Arnotts department store before making a decision this week.
The European Commission's deadline for objections expires today and the application must now be considered by both the Commission and the Irish Financial Regulator.
The two organisations are expected to rubber-stamp the application, giving ownership of the 167-year-old store to the two banks, which are likely to unveil a series of management and board changes at the retailer later this week.
The new board members are expected to be retailers. Arnotts owes the banks around €300m.
The future of current board members -- including Arnotts chairman Richard Nesbitt -- rests with Mark Schwartz, the American founder of advisory group Paladin, which has been advising Arnotts for several months.
Mr Nesbitt is said to be interested in a role as chairman, but sources familiar with the banks' thinking said it may be difficult for him to retain a role.
Sources have indicated that Financial Regulator Matthew Elderfield believes Anglo is trying to manage risk by taking a stake in the heavily indebted department store.
"While we cannot comment in relation to individual firms, banks have a variety of tools to manage distressed debt, including taking equity stakes -- this is a well-established practice and a wide range of Irish banks are currently employing this tool,'' a spokesperson for the regulator said last week.