AppId is over the quota
AppId is over the quota
By Simon Meads
LONDON | Tue Sep 20, 2011 12:41pm BST
LONDON (Reuters) - French retail group PPR (PRTP.PA) said it has postponed the sale of its catalogues business Redcats, as people familiar with the process said bids were expected to come in well below its 1.5 billion euro (1.3 billion pounds) reserve price.
The deal is the latest in a spate of auction processes to be postponed or shelved due to frozen financing markets, especially for private equity firms, and worsening outlooks for companies.
"PPR has stopped the auction process for the sale of Redcats," a PPR spokesman said on Monday, adding the group still wanted to eventually sell the business.
PPR hired Rothschild ROT.UL this year to look for buyers for Redcats, which includes the La Redoute, Stella McCartney Kids and OneStopPlus.com brands.
The business had attracted interest from numerous private equity firms including Advent, Apollo, Bain, Carlyle, Cinven and a team of TPG and PAI, people said.
However, first-round bids due on Tuesday were not expected to reach PPR's 1.5-2 billion euro target price range, two people familiar with the process said.
Frozen loan markets are in part to blame, though prospective bidders are also cautious about the business's trading outlook, some of the people said.
The sale of Redcats is part of PPR's strategy to focus on luxury brands such as Gucci. The group sold furniture retailer Conforama last year and has been planning to dispose of electronics and books retailer Fnac.
At the same time, the group has been looking to bolster its luxury division. Chief Executive Francois-Henri Pinault recently said the firm is in talks to buy Italian tailor Brioni.
Following an active first half for deals, increasing numbers of sales are being postponed or failing to meet sellers' price expectations.
French engineer Schneider Electric SA (SCHN.PA) has delayed the sale of subsidiary Custom Sensors & Technologies, while bids for Permira's PERM.UL TV production company All3Media failed to meet expectations, people familiar with those processes said.
PPR and Rothschild declined to comment.
(Reporting by Simon Meads; additional reporting by Sophie Sassard and Astrid Wendlandt in Paris; Editing by Steve Slater, David Cowell and David Hulmes)
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