More foreign investment as Spanish chain store sells 10% stake to Qatari investor

The new investment could see El Corte Inglés embark on an expansion strategy overseas.

Popular Spanish retailer El Corte Inglés has sold a 10% stake in the company to former Qatar Prime Minister Sheikh Hamad Bin Jassim Bin Jaber Al Thani for a sum estimated to be around €1 billion…

The investment marks the first time in the chain’s history that it has opened its share capital to a foreign investor, and is a further sign of Spain’s growing attractiveness to wealthy foreign investors eager to pour their cash into safe and secure markets.

The new Qatari investor will be automatically granted a seat on El Corte Inglés’ board, and will rub shoulders with some of Spain’s richest and most influential businessmen in the process.

El Corte Inglés is one of Spain’s most recognisable brand names, selling everything from food and clothing to household goods and insurance. The chain’s majority shareholders are descendants of its founder, Ramón Areces, who created the first El Corte Inglés store in 1930.

Today, the chain regularly posts annual sales above €15 billion, and is one of the leading retailers in Europe, offering postal services, ticket booking desks and even holiday packages to its customers. Despite its size and ambition, El Corte Inglés has rarely ventured beyond its Spanish borders, unlike fellow homegrown success stories such as Zara and Mango.

This domestic strategy has served to harm El Corte Inglés’ bottom line in recent years as Spain has struggled through a double-dip recession. In contrast, both Zara and Mango have become household names around the world, while El Corte Inglés has two stores in Portugal.

The Qatari investment could change this approach, however, with some observers suggesting that the next step will be to list the Madrid-based chain on the stock market before attempting to expand into foreign markets – most probably in Europe – in the near future.

According to Sheikh Hamad, he wants to “support El Corte Inglés’ development strategy”, which could see an expansion of the 86 Spanish department stores and 43 Hipercor supermarkets, which are owned by El Corte Inglés.