Grupo Mutua buys 8% stake in El Corte Inglés for €555m

Spain’s largest insurance company, Grupo Mutua, has acquired an 8% stake in El Corte Inglés, Europe’s biggest department store for €555m. Ignacio Garralda, the president of Mutua, will take a seat on the board. The deal implies an equity value of €6.937bn for El Corte Inglés, which has said it plans to use the funds to pay down its debt.

The deal will also give Mutua majority control of El Corte Inglés’s two insurance subsidiaries, Seguros de Vida y Accidentes and Correduría de Seguros, with a 50.01% stake in both, and make Mutua the fifth-largest shareholder in the parent company overall, behind Fundación Ramón Areces (37.39%), Cartera de Valores IASA (17.6%), Al Thani (10.33%), and Corporación Ceslar (9%).

Société Générale and Garrigues advised Mutua on the deal, while Goldman Sachs, Uría Menéndez and KPMG advised El Corte Inglés, with KPGM acting as co-adviser for insurance. Bank of America and Deloitte also advised on the deal. Société Générale’s large-cap M&A advisory practice in Spain is ranked Leading by Leaders League, while Goldman Sachs’s is ranked Excellent. Garrigues and Uría Menéndez’s M&A advisories are both ranked as Leading in Spain.