The Marks & Spencer Hong Kong and Macau business is expected to be sold to the UK department store’s long-established Middle Easter franchise partner Al-Futtaim.
M&S issued a statement overnight confirming the two parties were in talks over a deal where the existing business would be sold to Al-Futtaim which would then become a franchisee.
“A successful conclusion to these discussions would see Al-Futtaim become the new sole franchisee for M&S in Hong Kong and Macau,” the London-headquartered company said.
Al-Futtaim has partnered with M&S since 1998 when it opened the first MS store in Dubai. Today, Al-Futtaim operates 43 Marks & Spencer stores across seven markets in the Middle East, as well as in Singapore and Malaysia.
Most recently Al-Futtaim has extended the reach of M&S’s popular chilled food to three markets, and will shortly be opening the first standalone M&S Food store in the Middle East.
Marks & Spencer Hong Kong launched in 1988 and currently operates 27 stores, a mix of department stores and standalone food stores. It has three in Macau, two of them located in Sands properties.
The fact that M&S has issued a statement confirming the talks are underway suggests a deal is effectively complete.
M&S said the discussions follow a strategic review of the company’s international business last November, where the company proposed to have a greater focus on its established franchise and joint venture partnerships and operate with fewer wholly-owned markets.
“M&S and Al-Futtaim have now entered into discussions on the potential purchase and franchise which includes commencing a period of due diligence, which is expected to take several months to complete. M&S employees will be kept informed of any developments throughout the process and M&S stores in Hong Kong and Macau will continue to trade as normal,” the statement said.
Paul Friston, M&S’ international director, described Al-Futtaim as a key partner of M&S in Asia and the Middle East.
“We are both committed to putting the customer at the heart of everything we do. With significant scale and retail expertise in the region, we are looking forward to discussing the potential extension of our partnership to Hong Kong and Macau as we continue to grow and develop our business together.”
Stephen Rayfield, senior MD of fashion & lifestyle division with Al-Futtaim said the company was delighted to be working with M&S to explore the potential expansion of their partnership to Hong Kong and Macau.
“M&S and Al-Futtaim share values, and an approach that focuses the customer at the heart of our businesses. Al-Futtaim looks forward to building on our solid foundations as we continue to enrich our customers’ lives and aspirations through the provision of quality products and services in Hong Kong and Macau – these are among Marks & Spencer’s most successful and important international markets,” he said.