Noel Smyth's Fitzwilliam Finance Partners blamed the fact that it could not find a retailer willing to take on Dublin department store, Boyers, for its decision to close the business.
Fitzwilliam announced on Wednesday it plans to close the store on January 31st, throwing a question mark over the future of 48 direct jobs and a further 30 to 35 positions with various concessions.
However, the company is going to great lengths to avoid a row similar to that which blew up when Clerys on O'Connell Street shut its doors without warning in June, leaving 460 people out of work.
Management will meet Siptu and Mandate on Thursday. There are indications at least some staff can be redeployed to Boyers's sister company Arnotts.
At the same time, Fitzwilliam says it will honour any redundancy deal done with the unions and has set up a separate bank account to ensure the cash is there to meet any commitments. More than 130 Clerys staff received just the bare statutory severance in return for decades of service.
Smyth said the closure of Boyers was regrettable but "unfortunately, unavoidable". Fitzwilliam is a property company and had been trying to find a retailer to take on and run Boyers, but could not, despite talking to a number of potential partners.
Boyers is the unfashionable older sister in the Arnotts group and has been struggling for some time. Although the retailer's accounts do not break out figures for the North Earl Street store, it is said to be losing money and cannot compete with nimble local rivals such as the Primark-owned Penneys.
Debt
Fitzwilliam moved on Arnotts when it bought the €140 million debt that the department store group owed to
Ulster
Bank, giving it 50 per cent of the business. US fund Apollo, which held the €230 million formerly owed to
Irish Bank Resolution Corporation
, had the other 50 per cent.
The pair engaged in a bidding war that Fitzwilliam won almost by default when Apollo's partner, Bluegem Capital, pulled out in May, leaving the way clear for Smyth's company.
While he could find no one to take on Boyers, the developer has done a deal with Wittington Investments, Galen Weston’s family vehicle and owner of Brown Thomas in Dublin and Selfridges in London, which will take over and operate Arnotts.
Fitzwilliam will keep most of the properties that the Arnotts Group bought during the property boom with the €400 million or so that it borrowed from the banks. However, it will be putting the Boyers building on North Earl Street up for sale after the doors close in January.
