Iconic Clerys in talks with US-based investors on possible sale
Published 14/08/2012 | 05:00
ICONIC Dublin retailer Clerys has confirmed it is engaged in talks that could lead to a potential sale or investment in the struggling business.
A Boston-based investment firm, Gordon Brothers, has been linked to the Irish company.
A spokesman for the department store operator said Clerys has had a number of negotiations in recent months with various interested investors.
"Clerys has initiated discussions over the past few months with a number of parties in relation to securing the future of the company," he said.
"We can confirm that matters are currently progressing with one of these parties. We are hopeful of a positive outcome that will secure the future of Clerys as one of the country's leading retail companies," he added. He declined to name the party the retailer remains in discussions with.
Clerys chairman Eoin McGettigan, who was out of the country, wasn't directly contactable yesterday.
Gordon Brothers has an extensive track record in advising and investing in mature and distressed businesses.
It conducts over $50bn (€40bn) worth of transactions and appraisals every year, according to its website.
A spokeswoman for Gordon Brothers did not respond to queries.
It has been reported that Gordon Brothers would be willing to pay as much as €14m to acquire about €26m of debt owned by Clerys to Bank of Ireland. Much of that debt was amassed as the retailer undertook a store rejuvenation and acquired sites that it had planned to use to extend the premises on O'Connell Street.
Clerys also owns three home furnishings stores, in Leopardstown and Blanchardstown in Dublin, and in Naas, Co Kildare.
The outlet on the capital's main thoroughfare was one of the world's first purpose-built department stores when it opened in 1853. It has been owned by the Guiney family since 1941.
But it's been struggling during the downturn. Latest publicly available accounts for the business, for the year to the end of January 2010, show it made a €2m loss in that period. That compared with a €1.87m loss a year earlier. Excluding concession sales, Clerys own net sales fell 19pc to €17.4m. The company has cut staff working hours to contain costs.
Eoin McGettigan, the former head of Musgrave's UK operations, was appointed chairman at Clerys last year. At the same time, Frank O'Connell, a former retail director of Aer Rianta Retail, the commercial arm of the Dublin Airport Authority, was also made a director at Clerys.