Nouvelles Galeries/
Bazar de l'Hotel
de Ville

In 1989, recognizing the consolidation and internationalization of the retailing industry in Europe, Proventus identified the sector as an attractive area for investment. Due to a locked ownership situation, French retailing had not developed in pace with the rest of Europe and it became obvious to Proventus that operational efficiency could be significantly improved. Examination of Nouvelles Galeries and its publicly traded subsidiary Bazar de l’Hôtel de Ville revealed substantial holdings of unrelated, fully depreciated real estate and other non-core assets not reflected in the company’s market valuation. Clearly, there was a need for strategic reorientation.

After acquiring 26% and 18% shareholdings, respectively in Nouvelles Galeries and Bazar de l’Hôtel de Ville, Proventus entered into a dialog with management and the other large shareholders. The goal was to restructure the core business and utilize the real estate holding more efficiently. After constructive discussions to improve operations, Proventus concluded that Nouvelles Galeries could best improve its market position by finding a strategic partner.

Accordingly, Proventus initiated activities which in 1991 led to the sale of the shares in Nouvelles Galeries to Galeries Lafayette, the premier department store chain in Paris. Proventus remained a major shareholder in Bazar de l’Hôtel de Ville. In 1994, a proposal from Proventus to acquire control of Bazar de l’Hôtel de Ville was rejected. After consultation with Galeries Lafayette, Proventus decided to dispose of its then 25% holding in Bazar de l’Hôtel de Ville in the market.