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Number of buyers are tracking Clerys store

A number of buyers are understood to be interested in buying Clerys -- one of the country's most iconic department stores.

Several retail rescue specialists are believed to be involved in "behind the scenes talks" on the possible acquisition of the landmark department store.

The company refinanced around €20m in debt in February but the store continues to fight an uphill battle against depressed consumer spending and plummeting sales.

Among those known to have made an approach are Monte Carlo-based property tycoon Michael Flacks and business restructuring specialists Hilco.

The Michael Flacks Group, which specialises in buying distressed property businesses, recently bought Awear from Hilco. Weekend reports suggested that the Michael Flacks Group was also interested in buying Arnotts, but it is understood that the group has not made any approach to the banks that hold a significant share in the property.

The impact of Ireland's four-year economic whirlwind has hit all retailers in the country.

The most recent accounts for Clery & Co (1941) show that overall gross sales at the group, including those from in-store concessions, fell 8.5pc to €46.9m in the year to the end of January 2011.

The group's overall loss for this financial year widened to just over €2m from €1.87m a year earlier, with the retailer's gross profit of €10.9m obliterated by overheads and loan interest repayments.

Clerys, which was one of the world's first purpose-built department stores when it opened in 1853, also operates home furnishing stores in Leopardstown and Blanchardstown in Dublin, and in Naas, Co Kildare.

The company has been controlled by the Guiney family for the past 70 years. Denis Guiney bought it out of receivership in 1941.

Clerys borrowed heavily during the boom to undertake a major €25m upgrade of the O'Connell Street store.

Clerys has already cut working hours for its more than 200 directly-employed staff by 15pc to reflect the poor trading environment.

Operating expenses were cut by 13.3pc, or €1.87m, in 2010.

The company was obliged last year to enter negotiations with its lender, Bank of Ireland, to secure ongoing working capital, as well as capital to fund its operational changes. The retailer completed the refinancing of its debts in February.

Irish Independent