A shopping centre owner in the small Dutch city of Dordrecht is threatening to bankrupt AS Watson, the biggest health and beauty products retailer in the world, over an unpaid €9,000 rent bill.
Pieter van Loon, who owns around 30 shops in Dordrecht, has launched a case against the European arm of AS Watson, which also owns Superdrug and posted revenues of more than €10bn in 2019. The company is a key asset in Hong Kong tycoon Li Ka-shing’s global business empire.
Mr van Loon has launched court proceedings to have the company declared bankrupt on the basis that its subsidiary, perfume shop ICI Paris XL, has withheld rent payments for April from 155 Dutch landlords. The total withheld from Mr van Loon is €9,474.72.
“I received a letter pronouncing they wouldn’t pay the rent any more. That was it,” said Mr van Loon, whose company Tres Invest collected 67 per cent of the total rent it was due for April.
The episode is one of many battles playing out between commercial tenants and their landlords from Sydney to San Francisco, as the former withhold payments while their shops are forced to close because of coronavirus.
While other companies, including Dutch lingerie company Hunkemöller, JD Sports’ subsidiary Perry Sport, and a number of smaller retailers either paid in full or sought to negotiate with Mr van Loon, ICI Paris had not yet offered a compromise, he said.
Court proceedings are unlikely to result in bankruptcy for AS Watson, but Mr van Loon claims to be acting out of principle. “I said, ‘if you treat me like this, you’ll get the same reaction from me.’ That’s the reason I’m going to court.”
Lina Alblas-van den Burg, managing director of ICI Paris, confirmed receipt of a bankruptcy notice from one of the company’s landlords, but said there was “no chance that he will be successful under Dutch law”.
“At the same time, we do understand his sentiment. Therefore, we will meet him early next week in order to find a common agreement,” she added.
Tensions are high elsewhere in Europe too. Landlords in the UK received just a third of the rent due to them on the quarter’s payment date in late March, and big name brands such as Adidas have been pilloried by politicians for attempting to withhold payment. Adidas has now relented and offered to pay.
Across Europe, AS Watson has 8,000 stores. Mr van Loon’s tenant, ICI Paris, is a sub-brand with almost 300 stores. The company sits within Mr Li’s Hong Kong-headquartered port to telecom conglomerate CK Hutchison.
Mr Li is Hong Kong’s most celebrated tycoon. The 91-year-old is known affectionately as Superman, and has amassed a fortune in excess of $20bn.
CK Hutchison has seen “double digit” sales growth in its UK, Germany, Netherlands, and Poland retail operations since the outbreak of the pandemic, as residents stock up on hand sanitisers and cleaning products.
“I don’t want to play with a big Asian giant, but I have to make my statement: this is not how it works in Holland,” said Mr van Loon.
Additional reporting by Primrose Riordan in Hong Kong.
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