PARIS Dec 3 Managers at Kering's
loss-making La Redoute mail order unit have made an offer to
take over the business from the luxury and sports brand group, a
source close to the matter said on Tuesday.
The bid from Nathalie Balla and Eric Courteille, the heads
of La Redoute and parent division Redcats, follows media reports
of similar interest from OpCapita and real estate group Altarea
"The offer was submitted at the end of last week," the
source close to Balla said, confirming a report in Challenges
magazine, without giving financial details. Kering has said it
expects to make an announcement on a sale before Christmas.
La Redoute is part of Kering's mail order business Redcats,
the bulk of which it has already sold off as it seeks to
transform itself from a retail group to a company focused on
luxury and sports brands.
Kering has said significant job cuts would be needed as part
of a restructuring of La Redoute, sparking protests from staff
and local politicians in northern France, as well as demands
from Lille's Socialist mayor, Martine Aubry, for guarantees over
Unions fear around 700 jobs are at risk. La Redoute has
around 2,500 staff in France, where the government is battling
unemployment at a near record 10.9 percent. It employed around
5,000 people in 2008, and has been hurt by ageing logistical and
IT tools, as well as the growth of online shopping.
Kering has injected more than 400 million euros ($542
million) into La Redoute since 2008 and would be ready to inject
at least another 300 million in order to cover its losses for a
few years more and finance its restructuring, sources close to
the matter have said.
Kering Chief Executive François-Henri Pinault told Aubry he
was ready to give investment support to any buyer and that he
would guarantee operations during La Redoute's modernisation,
the politician said last month.
She had criticised Kering for not doing enough to bring La
Redoute's logistics and IT systems, and staff training, up to
A spokesman for Kering confirmed it was still aiming to
announce a deal by Christmas but declined to comment on possible
bidders. Kering has said it would favour a buyer who could keep
the business going.
Kering began its transformation in 2006 with the sale of
retail chain Printemps when the group was still called PPR, an
abbreviation of Pinault Printemps La Redoute. Kering is
controlled by the Pinault family.
Kering issued a profit warning last month, blaming one-off
charges related to sports brand Puma's restructuring
and the disposal of La Redoute.
($1 = 0.7377 euros)
(Reporting by Pascale Denis; Writing by James Regan; Editing by
Mark John and Mark Potter)