Selfridges was bought out by a consortium led by Central Group, Thailand’s largest retailer, ending months of speculation with a deal struck days before Christmas.
The deal brings together Central Group and Austrian real estate investment company Signa Holding, which will own the chain in a 50-50 partnership. Financial terms of the deal were not disclosed, but it was previously reported that the dynasty behind the department store, the Weston family, had received an offer of £ 4bn ($ 5.66bn) for its properties in the United Kingdom.
Central Group has an extensive network of high-end shopping malls and malls in Thailand, Vietnam, Malaysia and India and has grown in Europe over the past decade. She bought nine La Rinascente department stores in Italy in 2011, followed by Illum department store in Denmark in 2015.
Its acquisition of Selfridges extends a series of long-standing partnerships with Signa. The two companies have teamed up to lead the German group KaDeWe, with Central Group acquiring a majority stake in the Berlin department store in 2015. 2020.
The annual turnover of their combined department store portfolio was 5 billion euros (5.66 billion euros at current exchange rates) in 2019 and is expected to reach more than 7 billion euros by 2024 .
The pair’s deal for Selfridges is by far their biggest deal yet.
The takeover also marks a new chapter for Selfridges, whose London flagship was founded in 1908. The Selfridges group’s portfolio now includes 18 leading department stores, including Selfridges in London, Manchester and Birmingham, from Bijenkorf in the Netherlands, Brown Thomas and Arnotts in Ireland, their associated e-commerce platforms and properties in London, Manchester and five locations in Ireland.
Since its acquisition by the Weston family in 2003, Selfridges has built a reputation as one of the most innovative players in retail. Despite having been strained by the collapse in international tourism brought on by the pandemic, Selfridges remains a highly prized asset for a player like Central Group looking for a crown jewel for its European portfolio.
A family business
At the heart of Central Group’s history is the Chirathivat family. Although the clan currently ranks fourth Forbes‘richest list in Thailand with an estimated net worth of $ 11.6 billion, it started small, when Tiang Chirathivat arrived from the Chinese province of Hainan to a nation then called Siam, and decided to open a store in Bangkok in 1927, calling it Keng Seng Lee.
In 1957, Tiang’s son Samrit extended his father’s legacy by opening Thailand’s first department store in Bangkok’s Wang Burapha district.
Today the business is overseen by Samrit’s youngest of eight children, Tos Chirathivat, the group’s managing director and a driving force behind its continued international expansion since taking the reins in 2013. Older brother Prin Chirathivat is the deputy general manager of the group and his sister Yuwadee Chirathivat. is an executive director of the company’s publicly traded Central Retail Corporation subsidiary.
In total, according to Dr Natenapha Wailerdsak of Thammasat University Business School in Bangkok, dozens of family members are now involved in the business, including members of the fourth generation.
The interests of over 150 family members are overseen by a 12-seat family council that advocates for the needs of family members, but is not involved in the management of Central Group.
Although Thailand has other large real estate and business developers, including Siam Piwat and The Mall Group, Wailerdsak says there is little controversy over Central Group’s position.
“In Thailand it’s the biggest,” she said.
Indeed, with four million square meters of net leasable area, 60 malls, 2,400 retail stores, 1,000 grocery stores and 48 hotels, it’s easy to see the footprint that Central Group has left on the landscape. commercial from his country of origin.
In recent years, it has also sought to update its business model, entering e-commerce through a $ 500 million joint venture signed with Chinese JD.com in 2017. Central Group was also there. ‘one of Southeast Asia’s main unicorn delivery funders, Grab, and has its own fintech division.
In February 2020, Central Group listed on the Thai Stock Exchange a subsidiary overseeing its retail holdings in Thailand, Vietnam and Italy. Central Retail Corporation raised more than 78 billion Thai baht ($ 2.5 billion) in the largest ever IPO in Thailand. Its current market cap is just over 199 billion Thai baht ($ 5.8 billion).
According to Wailerdsak, this was the first time that the group’s retail arm went beyond a family business (its hotel group has been listed for decades). She said the move could mark a new era in which the family could take a step back from being so actively involved in running almost every part of the group.
Another indication of this move has been the appointment of Yol Phokasub, the former head of Siam Commercial Bank, as managing director of Central Retail Corporation. According to Wailerdsak, it is Phokasub, rather than any part of the family, who has increasingly become the public face of Central since the Thailand IPO.
“I think that means they are thinking about how to move from a family business to a professional company in the future,” she said, adding that the future of the larger core group rests in large part. party on its next CEO.
“Tos Chirathivat is highly respected. He is very well known and he is very familiar with the Thai retail business. Central Group is growing internationally thanks to him and its future will depend a lot on who succeeds it, although we do not know who it will be, ”said Wailerdsak.
Whatever the future, the new owner of Selfridges will focus for the moment on proving that he is the competent keeper of a former UK department store.
“It is a privilege to acquire Selfridges Group, including the flagship Oxford Street store, which has been at the center of London’s most famous shopping street for over 100 years. As family-owned businesses, Central and Signa will focus on providing exceptional and inclusive shopping and digital experiences for local residents and overseas visitors, to ensure that we can give all Selfridges Group stores a future. radiant for the next 100 years, ”Tos Chirathivat said in a statement.
As the CEO of the Central Group notes in his post-acquisition comments, much of this short-term mission will be preparing for the return of international tourism, especially long-haul Asian tourism interrupted by the pandemic, which will provide revitalize all of its European activities in the years to come.