The well-known perfumery chain Douglas struggled heavily during the pandemic. Today the company is going public. The most important goal: reduce a large mountain of debt.
The Douglas perfumery chain has had tough times. In the years of the Corona pandemic with lockdowns and home offices, dressing up wasn’t exactly the first civic duty. Sales collapsed and numerous branches had to be closed. The company also had to be geared towards online shopping.
Jochen Stanzl from CMC-Markets says about the development in recent years: “The renovation and the pandemic – it was all very expensive. It was all financed with outside capital, i.e. with debt. And these debts have become very expensive due to the increased interest rates .”
More than three billion euros in debt has accumulated. “The primary aim of the IPO is to reduce the company’s debt burden. So money is not taken and invested in growth, but debt is reduced,” said Stanzl.
What does the future of the company look like?
Debts down, costs down, these are important and correct steps. But even if business has been going better recently, many people still lack a vision of where Douglas should go.
Market observers are positive about the retailer’s transformation into a so-called omni-channel provider. This makes it possible to shop in-store, in the online shop and via the app.
Trade expert Gerrit Heinemann from the Niederrhein University of Applied Sciences – he once worked for Douglas himself – says the company is in an “excellent” position. “Douglas tackled the topic of digitalization right from the start, when many German retailers were still asleep, sold online very early on and has always been at the forefront of current digital topics.”
Douglas has been on the stock market before
Douglas was already listed on the stock exchange. Until 2013, the then owners took the group off the stock exchange and the company was to be restructured.
Around 33 million new shares will be issued in the new IPO today. At an issue price of 26 euros each. This means that the IPO is worth around 900 million euros. But there is a damper: The price is at the bottom of the range that Douglas set last week: 26 to 30 euros.
After all, the company said that Douglas shares were significantly oversubscribed in the run-up to the IPO. This means the demand is higher than the supply. Marc Richter from Baader Bank says: “Private investors want to invest, but not at any price, but rather in a price-conscious manner.”
Douglas is majority owned by the financial investor CVC Capital Partners and the Kreke family. You remain the main owner. The earliest they can sell their shares is around six months.
Heidi Radvilas, HR, tagesschau, March 21, 2024 6:27 a.m