New owners pumped €100m into store since Arnotts buy
Wittington Properties, controlled by Brown Thomas owners the Weston Family, took control of the Arnotts store in Dublin city centre in August in a deal with developer Noel Smyth.
That agreement divided the former Arnotts Group between the Westons, who keep and continue to trade the landmark city centre department store, and Noel Smyth’s Fitzwilliam company which gets control of the group’s remaining assets, including the nearby Boyers store and other properties in the area.
In a sign that the Westons have big plans for Arnotts, documents filed with the Companies Office show their UK-based Selfridges Group invested €103m into Arnotts within days of the deal being approved by the Competition Authority.
Documents filed by new newly formed holding company ARHL Holdings Limited show it was advanced €68m in cash by the parent of UK based Selfridges – Shel Holdings Europe Limited.
Shel Holdings Europe Limited also provided a finance facility, a form of loan, to ARHL worth €45m.
The three directors of ARHL are Selfridges managing director Paul Kelly, Brown Thomas head Stephen Sealey and Selfridges general counsel Adam Batty.
The moves mean that the Westons have committed at least €103m to Arnotts.
The funds are likely to be used for renovation and a possible expansion of the Henry Street store, which industry sources say is in need of investment. The Weston family, who also have a major stake in Penneys owner ABF, gained control of Arnotts after teaming up with businessman Noel Smyth during the protracted battle for the store.
After buying half of the group’s loans from its lenders, Mr Smyth’s Fitzwilliam Finance Partners had ended up in control of half of Arnotts, with the other half owned by US private equity firm Apollo Global Management.
The Irish and US sides initially vied with each other for full control of the business, until a combined Weston/Smyth team eventually came out on top last summer.
They subsequently agreed to split the Arnotts Group’s assets between them.
The Westons have never been shy about spending money on their properties.
They have just completed a renovation of the ground floor of Brown Thomas in Dublin and vastly improved its online presence.
The most recent accounts for Arnotts show it made an operating profit of €2.5m on revenues of more than €120m.
That profit however was wiped out by interest payments on a debt pile of more than €300m. Those debts however are expected to be largely written off by the Weston family.
Any move to expand or renovate Arnotts is likely to be welcomed and will provide a boost to the Henry Street and O’Connell Street area. While Henry Street has largely recovered from the downturn, the wider area has not.
O’Connell Street in particular has been hit hard, especially by the closure of Clerys department store in June ahead of its redevelopment. Boyers is now also earmarked to close at the end of this year, but it will trade into the busy Christmas season.
An Arnotts spokesman could not be reached for comment.
Article by Independent