PE firm Advent close to buying majority stake in German retailer Douglas Holding

Private equity firm Advent International is close to buying a majority stake in German perfumes, books, jewellery and confectionery retailer Douglas Holding AG, Reuters yesterday reported, citing two people familiar with the talks.

The deal would potentially torpedo plans by the group's CEO to take control of the company that owns over 1,900 stores, more than 1,500 of which are in Germany and the US.

Boston, Massachusetts-based Advent is in advanced talks with two of Douglas Holding's big shareholders, Erwin Mueller and the Oetker family, the report said, but added that no deal is expected imminently as legal issues need to be cleared up.

The news first reported by German newspaper Financial Times Deutschland, said that Advent will offer around €38 to €40 per share, valuing the Hagen, Germany-based company at between €1.5 billion and €1.6 billion.

Douglas CEO Henning Kreke and his family, who own 12.7 per cent stake in the company, had told shareholders in March that he would like to take Douglas private in partnership with a private equity investor.

The Oetker family, one of the richest families in Germany that owns the Dr. Oetker company, is the largest shareholder in Douglas with a 25.8 per cent stake, while Erwin Mueller holds 10.7 per cent and has options to acquire an additional 15 per cent that become due over the next few weeks.