Chapter 27
Debenhamsa
PRIVATE EQUITY GOES SHOPPING
It was October 23, 2003 as Philippe Costeletos enjoyed the California sun, but only from his hotel window. He was glued to the phone with his office back in London as the unexpected turn of events over the last few days required a swift and decisive decision from him now and could not wait for his return back to London.
Costeletos had joined Texas Pacific Group (TPG), one of the world’s largest private equity buyout firms, only 6 months ago but it was already starting to feel much longer. He had instigated TPG to team up with CVC Capital Partners and Merrill Lynch Group Private Equity to create an investment vehicle called Baroness Group, a consortium to target the buyout of Debenhams, one of the UK’s largest retail department stores. If they were to succeed, it would become a ground-breaking buyout deal and become, to date, the largest public company to be taken private in the U.K.
The race for Debenhams had started in February that year when Permira Advisers Ltd. (Permira), a leading European-based private equity firm, made its first offer. This was quickly dismissed by the board of Debenhams but Permira returned in early May on behalf of the newly formed Laragrove consortium with an indicative offer that the board could not brush aside. Costeletos recalled taking in this news a week before joining TPG and how he since had to constantly play catchup as he was late in joining the negotiations.
This was it, the final stage in ...
