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Baugur buying spree continues

Icelandic media reported last night that Baugur Group is busy continuing its buying spree. Baugur announced today its involvement in a consortium that acquired Danish department store ILLUM; a buyout of British restaurant supplier Woodward Foodservice; and its purchase of a stake in Danish property company Keops.

ILLUM Department Store

The consortium that acquired Danish department store, Magasin du Nord, last year, announced today that it has acquired the remaining 80% stake in ILLUM one of Denmark’s oldest and best known department stores. Both Magasin du Nord and ILLUM are strategically located landmarks in Copenhagen.

The consortium consists of Icelandic investors Baugur Group, Straumur Investment Bank and B2B Holdings.

ILLUM was founded in 1891 by A.C. ILLUM, the company was in the ILLUM family for 80 years until it was sold in 1972. In 2003, investment bank Merrill Lynch purchased ILLUM, and according to a released statement helped “reposition and transform it”. Icelandic State Radio, RÚV, reports that after years of posting a loss, ILLUM returned to profit last year. The Icelandic consortium made the purchase from Merrill Lynch.

In a released statement Skarphédinn Berg Steinarsson, Managing Director of Nordic Investments at Baugur Group said, “We recognize the growth in the Danish retail market and have a strong belief in the potential of ILLUM as a premium department store with a strong brand.”

The statement continues to say that “the ILLUM and Magasin stores will be run as independent businesses, following their individual strategies, with independent management teams.”

According to media reports ILLUM will focus on more costly designer named goods while Magasin du Nord will focus on less expensive consumer goods.

Straumur Investment Bank and B.R.F. financed the acquisition.

Woodward Foodservice

Yesterday it was also announced that Baugur Group and Talden investments took part in buyout of Woodward Foodservice, a British specialist restaurant supplier. The purchase was made from Giant Bidco the company that took the Big Food Group private earlier this year. Woodward Foodservice is a £180 million business and according to Icelandic State Radio, RÚV, with a workforce of over 1100.

Talden is an investment company based in Luxembourg, owned by two Icelandic entrepreneurs, one of which is Pálmi Haraldsson. Pálmi Haraldsson is a close friend of Jón Ásgeir’s and since the fraud and embezzlement charges were made against Jón Ásgeir, Pálmi has publicly endorsed him writing about their friendship in Icelandic daily Morgunbladid. Pálmi is the co-owner of low-cost airline Iceland Express, Nordic airline Sterling and Danish airline Maersk Air.

Lloyds TSB Commercial Finance provided debt finance.

Keops – Danish property company

Also announced in the Icelandic media yesterday was Baugur’s purchase of a 30% stake in Danish property company Keops, a deal worth DKK 564 million.

Last month, Baugur CEO, Jón Ásgeir Jóhannesson, who is facing charges of of fraud and embezzlement, told the Sunday Times, that he “will not make any big-name bids until his name has been cleared.”

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