Tuesday, March 11, 2008

New #1 in duty-free Italy's Autogrill, owned by the Benetton family, bought World Duty Free Europe, Then it bought full control of retailer Aldeasa, which had been a joint venture with Spanish tobacco company Altadis, now part of UK-based Imperial Tobacco Autogrill, which started out as the proprietor of service stations and rest stop restaurants along Italian highways, has suddenly become the world's largest airport retailer after a $1.6 billion buying free. It had already expanded into the airport restaurant business over the years. According to a Bloomberg News article ("Autogrill Buys Duty-Free Businesses for $1.5 Billion ( ", 3/10/08) "Autogrill operates more than 5,200 outlets in 42 countries, including shops for Starbucks and Burger King Corp. in the U.S., as well as retail operations at the Empire State building in New York. The company has bought Canadian, Belgian and U.K. competitors in the past year to build its business in airport retail and break into the market for in-flight meals." It's another case of pickups and discards through various sectors in the European economy. Spain's Grupo Ferrovial SA, the infrastructure specialist, in 2006 bought BAA, the UK-based airport operator (it runs, for example, Heathrow and Gatwick). That $20 billion is not going so well, apparently, thanks to the enormous BAA debt load, so Ferrovial was willing to raise some cash by selling off the World Duty Free Europe franchise. It's also a case of a retail service industry growing to serve a concentrating world airport management oligopoly. Thanks to ever-growing airport traffic, duty-free shops are thriving, according to a Financial Times article ("€990m deals make Autogrill major player at airports", 3/11/08). "While many areas of retail are facing troubling times with an uncertain economic outlook and a dearth of acquisition activity, that is not true in duty-free - underlined by the fact that Dufry, the Swiss-listed retailer, and Lagardère, the French media group, also bid for." 7:19:07 PM

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