THE OWNERSHIP of Dublin department store Arnotts in effect passed to taxpayers in Ireland and Britain yesterday after the European Commission approved a proposal from Anglo Irish Bank and Ulster Bank to take control jointly of the retailer in a debt restructuring deal.
The banks are preparing to retain ownership of Arnotts for the medium term – a period they hope will allow for the stabilisation of trading and a recovery in property values. Sources in the banks acknowledge privately there will not be a quick sale of the department store.
Arnotts owes the two banks more than €300 million and Anglo and Ulster, a subsidiary of the Royal Bank of Scotland, will now move to appoint new directors to its board.
Mark Schwartz, the head of US-based Palladin Capital Group, is expected to be one of those appointed to the board.
Palladin, a specialist restructuring group, has been ensconced at Arnotts for some months as an adviser to the banks.
The commission said in a statement: “The parties’ activities do not overlap and the commission therefore concluded that the proposed transaction would raise no competition concern.”
It is not clear if barrister Richard Nesbitt, Arnotts’ biggest shareholder and the architect of the Northern Quarter retail project on Henry Street, will retain a role.
The trade union Mandate yesterday said it was “looking forward to engaging on an ongoing basis with the new management regarding the future of Arnotts”.