La Rinascente parent to purchase Printemps

Luxury group PPR has said that it has entered into exclusive talks with RREEF to sell its Primtemps department store group to the fund for €1.08 billion. RREEF oversees the real estate portfolio of the Italian La Rinascente department stores and the Borletti Group, which is controlled by Maurizio Borletti, chairman of La Rinascente. PPR said on Tuesday that the transaction will be submitted to the European competition authorities and to Printemps employee representatives. If the deal is approved it will create a department store concern with 32 stores in Italy and France and collective sales of more than €1 billion. The new management structure has not been revealed, although Borletti last year brought Vittorio Radice on board as chief executive of La Rinascente. In a statement he said: „We have a lot of faith in the potential of this retail format, which increasingly turns shopping into entertainment. We want Printemps and its employees to be part of a new surge in development as we continue the repositioning and brand improvement that was launched several years ago.“ Printemps employs approximately 5,200 people and had reported sales of €752 million last year. The deal will include the Citadium sports megastore in Paris and 24 Made in Sport stores, the Madelios men’s emporium in Paris and a Printemps Design unit at the Centre Pompidou.

Meanwhile, a spokesman for PPR told WWD that the company is not looking to sell its other retail activities like the Fnac book and music chain and the Conforma furniture stores. „We will keep all of our businesses that are in line with our strategy for organic growth and international expansion. Printemps was a marginal, small part of our overall business.“ PPR is believed to concentrate increasingly on luxury goods.

Borletti first partnered with RREEF last year to buy La Rinascente, the store his family founded in 1917. He appointed chief executive Radice, who transformed Selfridges, to give the chain an overhaul. Radice outlined a plan to double sales to €605 million in the next seven years and aims to add more product categories to the stores. Department stores are facing challenges including increased competition from specialty stores, rising rents and more demanding consumers.