Returns policy

19 January 2006

The mooted £3bn valuation for the UK retailer would imply pretty chunky multiples, at a premium to rivals like Next and M&S. But if they pulled it off, Debenhams privateequity owners would have quadrupled their money in just over two years.

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Debenhams has asked banks to put in proposals for an IPO, according to a person familiar with the situation. This could reportedly value the UK retailer at more than £3bn.

Debenhams was taken private at the end of 2003 by private equity firms TPG, CVC and Merrill Lynch Private Equity, who paid £1.9bn for the retailer. Of this, £600m was equity.

Since then, Debenhams has been recapitalised and £1.3bn of dividend payments have been extracted. The group had £1.9bn of debt at the beginning of September 2005. It reported £240m of operating profit in the 53 weeks to September 3 2005.

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