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Qatari fund sells half its stake in Spanish retailer El Corte Ingles

REUTERS/Susana Vera
A woman wearing a protective mask walks past a closed down El Corte Ingles department store during partial lockdown as part of a 15-day state of emergency to combat the coronavirus disease outbreak, in Madrid, Spain March 15, 2020

Privately owned Spanish department store chain El Corte Ingles said on Tuesday 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 percent stake in Corte Ingles, while the department store chain will hold the other 5.53 percent, the group said in a statement.

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

“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 percent stake in El Corte Ingles in 2015 in exchange for a 1 billion euro loan, the first time it opened its share capital to a foreign investor.

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 euros, reducing its debt to 2.6 billion euros, the lowest leverage level in 15 years.

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

($1 = 0.9477 euros)