Hema, the popular but troubled high street stores chain, has decided to postpone its planned sale until next year after suffering a poor first quarter, the Telegraaf said on Friday.
The Amsterdam-based company said on Thursday first quarter turnover fell by 1.1% year-on-year. This was due to the very poor weather in March, strikes in France and reduced demand because of competition from online retailers like Zalando and physical stores such as those of discounter Primark, Hema said.
As a result it had decided to postpone its sale until 2019 after hoped-for higher turnover in December, traditionally the best month for retailers like Hema.
Hema said it was holding all options open, including a possible IPO. But bankers are less enthusiastic particularly since Hema has ‘ almost’ been sold three times in recent years. The bankers warn it will be difficult for Hema to achieve the targeted sale price of €1bn.
Present owner Lion Capital must first settle payment problems with the franchisers which operate 40% of the 500 Hema stores in the Netherlands. Under pressure from its own investors, Lion is anxious to rid itself of Hema for which it paid €1.1bn in 2007.
The most recent potential buyer was Belgian-based Core Equity which had agreed to pay €1bn for the group earlier this year. Core had planned to upgrade stores and widen expansion abroad.