Shoppers and staff shocked as banks move in on Arnotts

WHILE BUSINESS was brisk in Arnotts yesterday, staff and customers expressed concern over the future of one of Ireland’s oldest…

WHILE BUSINESS was brisk in Arnotts yesterday, staff and customers expressed concern over the future of one of Ireland’s oldest department stores after Anglo Irish Bank and Ulster Bank moved in to take control of it.

The takeover plan, dependent on approval by the EU competition commissioner, has come about because of the store’s inability to service borrowings of more than €250 million.

The store was at pains yesterday to stress it was performing “very strongly” and said trading was ahead of the Irish retail market. It insisted its 950 employees’ jobs were secure and it would be “business as usual at Arnotts”.

While it may be business as usual for now, it is thought the banks will want to recover as much of their loans as possible, and a sale of the business is the exit strategy for both institutions. Before any such sale, loans have to be restructured, a new management team appointed and long-term property plans put on ice.

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“It is not in their interests to damage the retail business because that is what will earn their way out of this problem,” said a source familiar with the banks’ plans for the department store.

The banks are the backers of Arnotts’ Northern Quarter development, which has been put on hold indefinitely following the collapse in the property market.

Arnotts has been trading on Dublin's northside for 167 years and its place at the heart of the city's history was a constant refrain among staff and shoppers who spoke to The Irish Times. At one of the many cosmetic counters on the ground floor, they were selling anti-stress creams but staff were relaxed about their future.

“There have been a few senior management meetings recently and some management had been made redundant so we weren’t entirely surprised by the news,” one staff member said. “But I think we’ll be grand. Sure you can’t shut Arnotts, it’s been here too long.”

Joan Kaye from Sutton said she didn’t really care who owned it but said she would hate to see it close. “I miss the old crowd in it. It’s not the same now, they only cater for youngsters,” she said. Recent changes at the store have attracted younger shoppers like Aishling Fahey, also from Sutton. “I get a fair bit here. It didn’t used to cater for young people but it does now, I love Arnotts and hope it doesn’t close.”

Another shopper remarked: “It really is part of who we are. You can go to any shopping centre in the world and you won’t find an Arnotts. It can’t close, it would be like when Bewley’s closed. It had to reopen almost immediately.”