Following months of speculation, it was revealed that Thailand’s Central Group has agreed on terms to snap up famous department store business Selfridges.
Despite competition from Harrods-owner the Qatar Investment Authority and Hong Kong department store business Lane Crawford, Central Group looks certain to emerge victorious and secure a deal with the Weston family to purchase the Selfridges business for an estimated £4bn.
The deal is expected to include Selfridges’ portfolio of 25 stores, which includes the Oxford Street flagship, Brown Thomas and Arnotts in Dublin, De Bijenkorf in the Netherlands and Holt Renfrew in Canada. For Central Group, that is an enticing prospect.
Central Group began with a single family store set up by Tiang Chirathivat in Bangkok in the early 1950s. In 1956, Tiang’s son, Samrit, established the nation’s first department store in the same city. The company also became the first to import international cosmetic brands to Thailand.
Seventy years later, Central is the owner of 3,700 stores worldwide. Tiang’s grandson Tos is now at the helm of the group.
Central already owns a raft of European department stores, including KaDeWe in Berlin and Alsterhaus in Hamburg, as well as specialty retail stores across Asia. Its portfolio also includes hotels, resorts and restaurants, and it has investments in financial services and fintech. Altogether it has around 80,000 employees globally.
Selfridges should sit well within Central’s business. The conglomerate has a wealth of resources at its disposal. “I believe the Central Group has got deep pockets and I am sure they’ve got long arms,” explains Andrew Jennings, whose career has included stints at the top of department stores such as Harrods, Saks Fifth Avenue and House of Fraser.
Those “long arms” look set to start working on Selfridges’ Oxford Street flagship.
Jennings describes the ongoing interest in European department stores simply, pointing to Central Group’s investments so far: “These are trophy businesses for the future.”
The company already has an existing link to Selfridges in its ranks – former chief executive Vittorio Radice is vice-chair of Italian department store business Rinascente, also owned by Central.
It is likely Radice played a part in the latest likely addition, which marks a big moment in Central’s ongoing European expansion. Radice helped on Central’s acquisition of Danish department store Illum, as well as KaDeWe, while he was Central Group Europe’s boss – a position he held until September.
He is now a non-executive board member, involved in “the company’s decision-making process” and overseeing new openings, as well as the transformation of existing stores across Europe.
Radice led Habitat in the UK before being approached to join Selfridges in 1996. He is widely recognised for transforming Selfridges into a modern fashionable destination during his time in charge. His quest to transform the retailer was rooted in his idea of what a department store should be. He maintained in a 2013 interview with Elle Decoration: “It’s not about selling product. We’re selling a good time, an experience, a holiday without a flight.”
Similarly, in a Management Today interview, he said: “This store is not going to compete with any store on Oxford Street; it’s going to compete with restaurants and cinemas.”
Following his time at Selfridges, Radice went on to briefly join Marks & Spencer before joining Rinascente in 2005. Central Group bought it in 2011.
Meanwhile, Selfridges continued to succeed in his absence under the Weston family’s leadership. Selfridges maintained its must-visit reputation by launching new initiatives designed to bolster even further an unparalleled reputation for retail theatre and experience, increasingly married with a commitment to sustainability.
“Arguably the only department store group that really has stepped up to modern retailing is Selfridges,” says Peel Hunt analyst John Stevenson. “They’ve got a fantastic offer and I don’t just mean the product – it’s their online capability, the way they engage in stores, the way they run events; it’s a really terrific customer experience. The offer has been refreshed.”
Jennings agrees: “The Weston family has done a phenomenal job in investing in the business.”
Radice’s reunion with Selfridges may prompt questions around whether it will signal dramatic change. Stevenson does not think so. “It’s not as though Selfridges needs a revamp,” he says. “It’s been performing well. I don’t look at Selfridges now and think ‘they need to bring Vittorio back to change things’, but obviously he was a very good leader for Selfridges.”
Jennings also sees the likely involvement of Radice again as only a positive addition to a strong team: “With Vittorio, it’s rather like ‘back to the future’. I think Vittorio reunited with the Selfridges team can do a great job.”
Radice’s transformation of Selfridges into a must-visit destination was a clear success. As exciting in-store experiences are once again seen as vital to draw people back into shops after almost two years of Covid-19 restrictions and closures, Selfridges’ strategy to entertain and delight its visitors, as executed under the Weston family leadership, looks set to be maintained under new ownership.
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