Members of the Roche retailing dynasty will receive annual rents of almost €18 million from Debenhams after the British chain's €29 million buyout of Roches Stores, a deal that brings more than a century of trading in the family-owned department store business to an end.
The Roche family retains ownership of the freehold properties in the group but the Roches Store brand name, familiar to generations of shoppers, will disappear from the retail scene.
The stores are said to have annual sales of €290 million, although a Roches spokeswoman would not comment when asked if they were profitable or not. The company does not file accounts in Ireland.
The deal was made public yesterday after weeks of speculation. Informed sources said that Roches had spurned an offer of €80 million for its landmark building on Henry Street in Dublin from the developer Joe O'Reilly, owner of the adjoining Ilac Centre.
Debenhams has acquired long-term leaseholds on nine of Roches' 11 outlets, including the Henry Street store and a prominent outlet at Patrick Street, Cork. The other leaseholds are at Blackrock, Tallaght and Blanchardstown in Dublin and at Limerick, Galway, Waterford and Tralee, Co Kerry.
This gives Debenhams significant additional floor space, clearing the way for a big expansion in a market in which it currently has only three stores.
A company spokesman in London said its original outlet at the Jervis centre in Dublin, very near Roches' at Henry Street, will "trade as normal" after the deal.
In an agreement that secures the future wealth of the Roche family, the chain has agreed to pay annual rents of €21-€40 per square foot for use of the 500,000 sq ft floorspace in the buildings.
The actual purchase price is €29 million plus the value of stock, a comparably low figure that reflects perceived poor trading at some of the outlets.
"The increasing importance of scale in European retailing means that the long-term interests of staff and customers are best served by this sale of the retail business to Debenhams," Roches said.
Beneficiaries of the transaction include Roches' director Richard Roche, "key decision maker" for the family, who led the negotiations for the company.
The others include Diana Roche and Patricia Roche, both Dublin-based, and David Roche, based in Ohio. Older members of the family such as Stanley Roche and William Roche will also benefit.
The main shareholding in Roches Stores (Holdings) is vested in an Isle of Man-based entity and not publicly available. In keeping with the Roches' aversion to publicity, the company's spokeswoman offered no information on the family yesterday.
Marks & Spencer has agreed to buy out the leasehold on Roches' outlet at the Wilton centre in Cork. That site is not owned by the Roche family.
The transactions will result in the loss of 91 jobs at Roches' support office in Sandyford and at a store at Nutgrove, in south Dublin, which will close. However, Roches said more than 1,900 management and floor staff at the other outlets will transfer to Debenhams and Marks & Spencer.
Roches said in a statement that it expected the transfer to close by September 6th.
Retail sources believe Debenhams will move to replace concessionaires in the Roches outlets with others such as Oasis, Warehouse, Red Herring, Antoni + Alison, Ben de Lisi, Wallace and Julien Macdonald. However, Spanish chain Zara will retain prominent concessions in Henry Street and Blanchardstown.
