M&S puts sale of Brooks Brothers and Kings on hold


Nigel Cope,City Editor
Monday 14 April 2014 02:24

Marks & Spencer said yesterday that the sale of its two American chains, Brooks Brothers and Kings Super Markets, would be delayed by last week's terrorist attacks. However, the struggling retailer said both deals should be completed by Christmas.

M&S put both businesses up for sale in March and forecast that Kings would be sold by September with Brooks Brothers set to follow byOctober. M&S is in exclusive talks with one bidder over Kings. It is down to a shortlist of around four bidders for Brooks Brothers and had hoped to announce a move into exclusive discussions in the next few weeks.

One of Brooks Brothers' 221 US stores has been destroyed in the attacks as it was located in Liberty Plaza at the base of the World Trade Centre. A second store in Liberty Street has been used as a makeshift morgue and treatment centre for victims of the disaster.

M&S's adviser on the deals is Morgan Stanley Dean Witter, which occupied several storeys of the collapsed towers. M&S called off talks with Morgan Stanley last week to enable the bank to concentrate on looking after its own staff. "We e-mailed everybody who we are talking to and told them to concentrate on their own people for the time being. That is what is important," an M&S spokesman said. Talks are expected to re-start later this week.

M&S said it was confident that the price of the deals would not be materially affected. "There is no reason for us to believe that the level of the bids will be revised," the company said. However, the potential bidders may take a more bearish view of the price if they feel consumer confidence is going to suffer as a result of the terrorist attacks and America's response.

The shortlist of bidders for Brooks Brothers are thought to include the US retailer May Department Stores, the Hong Kong-based Dickson Concepts, the design group Tommy Hilfiger and the private equity firm Texas Pacific Group. The expected price tag had been $300m before last week's events but may now be lower.

M&S has pledged to return £2bn to shareholders by March next year. The shares closed 2.75p higher yesterday at 244p.

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