Retail

Clayton Dubilier’s beauty deal uglier than it looks

20 Jun 2006

The LBO firm s purchase of US retailer Sally Beauty at first blush looks out of character for the turnaround specialist. It s taking a minority of a public firm and keeping management. Nothing novel about that. But to make money, Sally needs a makeover.

Morrisons CEO hire should plug boardroom leaks

8 Jun 2006

Marc Bolland s appointment had been widely telegraphed. That s symptomatic of the leaks that have destabilised the UK retailer. Finding a CEO and ending the infighting between Ken Morrison, the chairman, and his deputy should fix the leaking tap.

New Look backers set for extra-large returns

2 Jun 2006

Private equity firms Apax and Permira look to have trebled their original money in the UK clothing retailer, since buying it in March 2004. How have they done it? By growing New Look at a rate of knots and trying on some topofthemarket financing techniques.

Morrisons boardroom battle ends in fudge

25 May 2006

Sir Ken Morrison is to hang on as chairman until 2008, then become an honorary figurehead. That s a victory of diplomacy over common sense. His continued presence could clip the wings of the new chief executive. And making a big shareholder life president is a risky business.

Kingfisher investors nail their hopes on a bid

24 May 2006

The UK DIY retailer has been hammered by a consumer slowdown and stiff price cuts. So why the 30% premium to the sector? Partly it s because speculation a US rival will swoop is firmly baked into the share price. But investors may be waiting for a while.

M&S suffers from great expectations

23 May 2006

Two years into its recovery plan, the UK retailer's share price has doubled. But the worry is that M&S has run out of positive surprises. Yet M&S still offers a compelling recovery story. Its rating relative to the sector looks pessimistic.

Ahold looks ripe for a break-up

19 May 2006

The scandalhit Dutch retailer s recovery has proved patchy, and the synergies between its retail divisions elusive. A full breakup would potentially unlock 30% of value and give investors the choice of what to do with the pieces.

Tesco gets Buffett seal of approval

17 May 2006

The UK retailer ticks all the US billionaire s boxes. Virtually unassailable market position, low gearing the list goes on. Shame it has taken an endorsement from the folksy value investor to point out the obvious: that Tesco is undervalued by the market.

DSG plugs into flat-screen TV boom

10 May 2006

Discretionary items like flatpanel TVs and iPods are driving the UK retailer s sales even though highstreet spending is still subdued. DSG may be at a sweet spot in the product cycle. But it seems consumers are changing their priorities when it comes to musthave gadgets.

Debenhams forced to put itself on special offer

4 May 2006

The UK retailer has priced its shares at the very bottom of the range, at a 20% discount to rival Marks & Spencer. That may be well below the sort of values Debenhams' owners were shooting for. But niggling uncertainties mean it's still no bargain.

Morrison’s CEO payout looks like rewards for failure

26 Apr 2006

True, it s hard to see how much autonomy Stott really had. But shareholders are now left footing the bill for Sir Ken s mistakes. The UK retailer is paying £1.4m to see off Bob Stott, a lieutenant of chairman Sir Ken Morrison, even after five profit warnings.

Tesco offers investors cashback

25 Apr 2006

The UK supermarket plans to return to the progressive dividend it shelved three years ago, and buy back £1.5bn in shares. That s a great PR exercise. But Tesco still has growth and impressive returns on investment. It might do better to spend the cash itself.

Debenhams bosses show timing is all in LBOs

23 Apr 2006

The UK retailer s managers made a packet when they ran Homebase. But GUS, its subsequent owner, hasn t done so well. No wonder potential investors in Debenhams are so keen for them to stick around and stay invested.

Debenhams backers try on ambitious £1.8bn valuation

20 Apr 2006

At that price, the UK department store would trade at a 15% discount to the retail sector. At first blush, that might seem fair. But with no property and breakneck expansion planned, investors are being asked to swallow huge risk, which may not be fully priced in.

WH Smith breaks under high street pressure

12 Apr 2006

Hiving off the UK retailer s news distribution arm makes sense, given the lack of synergies. But there s scant value to be released. The best hope is that greater focus will help liven up the tired retail business or at least lure a private equity bidder.

M&S knocks UK high street into a cocked hat

11 Apr 2006

The UK retailer s sales and earnings are motoring ahead mainly at the expense of less fortunate peers. M&S shares have now topped the price set by raider Philip Green by almost 50% yet could still have further to run.

Metro wins with sale of 40% Praktiker stake

11 Apr 2006

Just six months ago, the German retailer looked like a loser. It struggled sell the DIY chain. But since then, demand has surged. It s selling its Praktiker stake for E500m. But some investors may be angry with the banks that agreed to shorten the lockup period.

Debenhams IPO plan looks too cheeky

11 Apr 2006

Having stripped out value through asset sales and dividend recaps, the department store s private equity owners are seeking a quick flip. Investors may be tempted to subscribe in a buoyant market, but they should demand a fat discount. The owners can afford it.

Compass sells SSP for stunning £1.8bn tag

10 Apr 2006

Has the catering giant kicked the habit of producing only bad news? In the last month it has landed a new CEO and sold its concessions unit. But in some ways Compass has done the easy bit. Turning round the core business won't be a simple task.

How Wal-Mart lost its way with Asda

6 Apr 2006

When the US retail juggernaut bought the supermarket chain in 1999, it threatened to transform the UK retail landscape. Instead, Asda now languishes in third place in the supermarket rankings, according to data released this week. What went wrong?