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Retail

Spain's El Corte Inglés Buys Back A 5.53% Stake From Primefin

Privately owned Spanish department store chain El Corte Inglés said it bought back half of the stake Qatari fund Primefin held in the company.

Primefin, an investment vehicle of Sheikh Hamad Bin Jassim Bin Jaber Al Thani, the former Prime Minister of Qatar, will keep a 5.53% stake in Corte Ingles, while the department store chain will hold the other 5.53%, the group said in a statement.

The amount of the purchase has not been disclosed, but El Corte Inglés said it values the group at about €7 billion ($7.39 billion), which would make the stake worth about €387 million.

'The operation is carried out without increasing debt and with own resources,' the Spanish retailer said, adding it will keep the shares in treasury.

Primefin had originally bought a 10% stake in El Corte Inglés in 2015 in exchange for a €1 billion loan, the first time it opened its share capital to a foreign investor.

El Corte Inglés

The department stores, which are ubiquitous in Spanish city centres, were created in the 1930s by businessman Ramon Aceres and the group gradually became one of Spain's largest employers and one of the biggest retailers in Europe. Its majority shareholders are the descendants of Areces.

Last year, it sold an 8% stake and half of its insurance businesses to Spanish insurer Grupo Mutua for €1.15 billion, reducing its debt to €2.6 billion, the lowest leverage level in 15 years.

El Corte Inglés posted a €120 million net profit in 2021 driven by its retail division, helped by the easing of the COVID-19 pandemic and cost cuts.

Read More: El Corte Inglés Announces New Executive Committee

News by Reuters, edited by ESM – your source for the latest retail news. Click subscribe to sign up to ESM: European Supermarket Magazine.

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