The acquisition of Selfridges for £4bn is considered excessive in hindsight.
- Tos Chirathivat of Central Group acknowledges the purchase price was steep.
- Rising global interest rates added to the financial considerations.
- Challenges emerged following the collapse of investment partner Signa Holding.
- Plans are underway to revitalise Selfridges’ Oxford Street store.
Tos Chirathivat, the executive chairman and CEO of Thailand’s Central Group, has reflected on the £4bn acquisition of Selfridges, acknowledging it as a high price, notably due to the increase in global interest rates. He remarked, “You would want the lowest price possible to buy something… is £4bn high? Yes, it’s high, especially in this environment.” Despite this, Chirathivat remains optimistic about the long-term value, suggesting that in a decade the price may not seem as high.
Central Group, which became the majority owner of Selfridges through this transaction, faces challenges following the collapse of their co-investor, Signa Holding. Unforeseen dealings with Saudi Arabia’s Public Investment Fund resulted in the latter increasing their stake to 40%. These developments came as a surprise to Central, as revealed in Chirathivat’s comments, “He only told us later when it was done… that he sold part of it to the PIF.”
In response to these challenges, Central Group is focusing on enhancing Selfridges, particularly the iconic Oxford Street location. The goal is to transform Selfridges into the world’s best store with increased luxury offerings and improved services. Chirathivat expressed confidence in this ambition, citing the appointment of André Maeder as CEO of Selfridges Group as a strategic move to realise this vision. He confidently stated, “We have three good floors [of six]… we are working to improve every area.”
The future of Selfridges may validate the high purchase price as Central Group implements its ambitious plans.
