Trouble at El Corte Inglés

Probably Spain’s most famous and best-loved store, El Corte Inglés, is to Madrid what Selfridges is to London and Macy’s to New York. Before the shopping-mall, Spanish commercial establishments were mostly local and specific, which helps understand the success and reputation of the country’s first and only department store. Whether it’s a TV, a silver tray, the latest best-seller, fresh kiwis, a Burberry raincoat or garments by prestigious Spanish brands like Agatha Ruiz de la Prada and Loewe, you can get it at any of the Corte Inglés stores in Spain’s main cities. Stores are generally very large with several floors offering a broad scope of products: music, movies, portable and household electronics, furniture, hardware, books, clothes, groceries, gourmet food, cars and real estate. Even faultfinders who complain about prices and the snotty attitude of the sales staff will admit that there is no easier place to buy quality goods on credit.

It has recently been made public that the company founded by Ramón Areces in 1940 is facing a delicate situation. The Areces family, who owns 9% of the company capital, has filed a criminal complaint against the executive management of El Corte Inglés. The battle began after the agreement with Qatari Sheikh Jassim Bin and the ousting of Carlota Areces –niece of the founder– from the board of directors. Carlota Areces was accused of disloyalty for criticizing the deal with the Qatar investor. The Areces family reacted by filing a commercial claim and criminal proceedings have now been initiated, accusing the board of inflicting losses on the company. Apparently, Bin Jassim was received as a lifeline backer but warned against intending to keep the company at a bargain price. Will the rift be solved? Spain would simply not be Spain without El Corte Inglés.