Landmark’s New Look bid banks on founder support

Boby Kurian & M Rochan BANGALORE

THE Mickey Jagtiani-led Landmark Group is expected to bank on founder, shareholder and private equity (PE) support in a last mile face-off with the Texas Pacific Group-Warburg Pincus combine to buy out UK retailer New Look for $3.5 billion. The $1.5-billion Landmark, a group of Indian origin with a portfolio of retail assets like Lifestyle and Max could be mustering the support of New Look’s founder Tom Singh, one of the wealthiest British businessmen, who holds a minority stake in the UK retailer and may still influence the final outcome of the bidding process, informed sources said.

Landmark is likely to bid jointly with CVC Capital Partners, and probably rope in another investor on board, to overcome a strong pitch by TPG-Warburg combine, which the UK media reports placed as frontrunners at the moment. Tom Singh founded New Look in 1969 and played a key role in taking the company private in 2004 with the backing of PE majors Apax and Permira, who are now looking to cash out. Landmark, with retail experience in competitive emerging markets, is expected to be the core operational anchor with the PEs pumping in sizeable chunk of the funds. Incidentally, BC Partners, another solo contender in the fray, also has a track record of partnering in buyouts along with managements.

Landmark, which already owns a 3% stake in the company, was seen as a strong contender before TPGWarburg showed up to make deal-making a delicate affair. The Middle East group, with an accelerating business in India, also owns the rights for New Look in this part of the world. When contacted, H Ramnathan, executive director of Landmark Group, declined to comment on the bidding process citing stringent confidentiality clauses. New Look, the second largest women’s’ wear retailer in UK, has annualised revenues of around $2 billion. Merril Lynch is managing the process which could lead to one of the biggest recent buyouts in the European retail space.

ET