Central Group, a Thai retail conglomerate with 75 years of history, has acquired British luxury store chain Selfridges as it aims to become a major global player in the department store sector.
The group released a statement on Friday with its long-standing partner Signa Holding, a real estate and retail group in Europe, that they entered into a definitive agreement to acquire Selfridges Group, a luxury retailer, from the Weston family.
The value of the deal was not disclosed, but it is estimated at £4 billion according to sources from Central Group and Signa who requested anonymity because the information is confidential.
The Selfridges Group portfolio comprises 18 iconic department stores, including Selfridges in London, Manchester and Birmingham, de Bijenkorf in the Netherlands, Brown Thomas and Arnotts in Ireland, their associated e-commerce platforms and properties in London and Manchester, and five locations in Ireland.
The transaction sees Selfridges Group become part of the combined Central and Signa portfolio of luxury department stores, which includes Rinascente in Italy, Illum in Denmark, Globus in Switzerland and the KaDeWe Group, which operates in Germany and Austria (starting in 2024). The pro-forma annual turnover for the combined department stores portfolio was €5 billion in 2019 and is projected to grow to more than €7 billion by 2024.
The combination will create a complementary portfolio of leading European luxury department stores, enabling innovation and knowledge sharing across different locations, according to the statement.
Selfridges, founded in 1908 by Harry Gordon Selfridge, is best known for the giant store on London's Oxford Street. It has been controlled by the Westons since 2003.
Central and Signa are expected to operate all stores in the Selfridges Group, including Selfridges, de Bijenkorf, Brown Thomas and Arnotts. Operation by existing leadership teams continues, as well as for e-commerce platforms and operating companies, according to the statement.
The Canadian business Holt Renfrew remains with the Weston family.
The Central and Signa 50/50 partnership should build on Selfridges' strong foundation and luxury online customer offerings, developing an integrated and compelling omni-channel proposition, with exclusive online stores an extension of physical stores, said the release.
Tos Chirathivat, executive chairman and chief executive of Central, said Central and Signa will focus on delivering exceptional and inclusive store and digital experiences for both local residents and overseas visitors, ensuring all stores in the Selfridges Group have a bright future for the next 100 years.
"We are looking forward to working with the management teams and colleagues across the Selfridges Group as we seek to create a leading global luxury retail company," he said.
Stefano Della Valle, chairman of CGE Investments Ltd (Central Group Europe), said Selfridges Group is Central and Signa's second department store acquisition during the pandemic, representing a huge vote of confidence for both urban retail stores and the future of the department store.
A university retail business lecturer who requested anonymity said the latest acquisition by Central Group indicates the physical retail store business is very much alive.
"Retail business is shifting to omni-channel shopping; no longer limited on online and offline. I still believe in the potential of physical stores, reflected by the recent expansion by two e-commerce players: Amazon and Alibaba. These two already expanded into the physical store business during the pandemic. Moreover, European customers still love the outdoor lifestyle," said the source.