Waterstones chief executive James Daunt has shared his hopes that the chain will continue to open fresh stores under its new ownership, as he conducted widespread interviews with the national media following the chain's sale to Elliott Advisors yesterday (26th April).
The bookselling chief told the BBC the retailer’s new parent should mean the 283-store chain will grow a lot faster. Despite Elliott’s reputation as an aggressive “activist investor", it has not acquired Waterstones to force through change, Daunt said. He expected instead Elliott will “see us grow and ultimately sell us for a nice profit - that's what private equity people do".
In an interview with the Telegraph, Daunt continued to underline the chain's hopes of opening more stores. It opened new branches in Clifton and Reigate earlier this month and a new shop in Manchester’s Trafford Centre on Wednesday.
“We began expanding two years ago at a very fast rate," Daunt said. "At this stage the intention is to carry on with what we are doing. Having a dreary merchant bank around the business has been quite a distraction, but in the last few weeks we have been opening new shops.”
To the Guardian Daunt stressed there would be no planned shop closures or job cuts as a result of the sale. “Quite the opposite – we’re very much in expansion mode, we’re opening up new shops,” he said. He also revealed the sale process over the last few months had been distracting. “By the end of the year we’ll have more shops not less, and next year an awful lot more shops … For the last year we’ve been pretty distracted with this whole process but have managed to keep going at a reasonable clip – hopefully we will now get on with it with a bit more focus,” he said.
However, the chief executive admitted to City AM that Elliott Advisors made “a very strange bedfellow for Waterstones”, considering the firm’s reputation as an aggressive hedge fund activist.
“But if they are building up a private equity interest, then we are not. We are an interesting company with a very strong position in our own little niche,” he said.
He also conceded that once Elliott “get the keys, they will do what they want”.
“They own the business,” he said. “But my assumption is we are to carry on and they want us to keep making the business more profitable and keep on growing it. We’ve been opening up quite a lot of shops; a bit more capital will allow us to do that quicker.”
The new ownership deal, which sees Alexamder Mamut's Lynwood Investments retain a minority stake, is expected to formally complete in a couple of weeks.
Publishers, agents and authors have welcomed the fact that Daunt has been retained by the new owners, along with his management team. The firm is expected to appoint a new board, though.