Assessment: Among the candidates to take over the concession are Delta and Clal. The general manager of the Blue Square chain: The closure is due to declining profits.
The Marks & Spencer chain of shops is closing down in Israel. The 120 employees received this announcement this morning (Monday). The concession operated a chain of shops in Israel run by the Marks & Spencer Israel company, which is held by the Blue Square group (70%), Northern Co-op (20%), and Co-op Jerusalem (10%). The general manager of the Blue Square, Yaakov Gelbard, told "Globes" in response that the chain was being closed because of continuously falling profits. Sources in the branch told "Globes" that the losses were in the region of NIS 2 to NIS 5 million per year. The sales turnover of Marks & Spencer Israel is about NIS 70 million per year. The sources added that the management of MSIP did not reach agreement with Marks & Spencer regarding the renewal of the concession.
It was also announced the new Marks & Spencer department store, due to open in March at the Shalom Centre in Tel-Aviv, will not open, and instead operations of either Hamshbir La’Zarchan or Blue Square is being considered there. At the same time MSIP is considering the cancellation of the lease at the Shalom Centre of Azrieli.
Sources in the field told "Globes" that the possible candidate to acquire the concession to operate the Marks & Spencer shops in Israel is the Delta group, which has 20 ‘surplus’ stores. This is because Delta is the largest Israeli supplier to Marks & Spencer. The British company buys from Delta goods to the value of $150 million every year. Another possible candidate is Clal, which can add the activity of Marks & Spencer to the activity of their "Polgat" and "Golf" chains. The general manager of Delta, Dov Lautman, told "Globes" in response that there had not been any discussions on this matter.
The annual turnover of Marks & Spencer International is more than $10 billion, with a net profit of more than $1 billion.