Banks take control of Arnotts and say future now secure
Published 10/08/2010 | 05:00
STATE-owned Anglo Irish Bank and Ulster Bank last night pledged their commitment to Arnotts after the European Commission approved their bid to take control.
A new management team appointed to head the debt-ridden retailer also maintained that the iconic Dublin city centre store would continue to play a leading role in the Irish retail sector.
In a statement, both banks said they were committed to Arnotts, which employs 950 workers, but would not be involved in the management of the company.
Instead, retail specialist Mark Schwartz -- CEO of Palladin Capital Group who has worked with the company and bank over the last five months -- is expected to oversee the running of the business.
Mr Schwartz reassured staff, suppliers and customers that the great institution would continue to play a leading role in the Irish retail market.
"Arnotts is a tremendous business and we need to continue to enhance the shopping experience for our long-standing customers," he said.
"Our goal is to focus on the future, work closely with our strong staff and our suppliers, and create the conditions which will enable Arnotts to thrive for many years to come."
The historic store, which first opened its doors in 1843, is understood to be experiencing steady trade.
A proposed €800m redevelopment near the Henry Street premises left the firm saddled with huge debts of about €300m. The planned Northern Quarter was set to include a shopping, residential and entertainment district.
Fears had been raised over the future of staff when it emerged that the troubled financial institutions were trying to take control of the department store.
The European Commission confirmed it had cleared the transfer, stating it would not harm competition in Europe.
The Mandate trade union said it was looking forward to engaging with the new management team.
Linda Tanham, Mandate assistant general secretary, added: "Now that European Union approval has been granted for the takeover of Arnotts by Anglo Irish Bank and Ulster Bank, we in Mandate are looking forward to engaging on an ongoing basis with the new management of the company regarding the future of Arnotts as a retail business so that we can secure the jobs and terms and conditions of the staff who have contributed so much to the company."
Damien Cassidy, chairman of the National Conservation and Heritage Group, said he was "appalled" at the EU decision to allow the banks take over the iconic store.
"I would be greatly afraid that they would kill it off. All we have are mealy-mouthed reassurances about retaining jobs which we have heard before," he said. "The heart of Dublin is going to be ripped apart."