Al-Futtaim has worked in partnership with M&S since 1998 when it opened the first M&S store in Dubai

Al-Futtaim has worked in partnership with M&S since 1998 when it opened the first M&S store in Dubai

UK retailer Marks & Spencer (M&S) today (30 August) revealed it has begun talks with franchise partner Al-Futtaim for the potential purchase and franchising of M&S's owned retail business in Hong Kong and Macau.

The talks follow M&S's strategic review of its international business in November of last year, when the retailer proposed to have a greater focus on its established franchise and joint venture partnerships and operate with fewer wholly-owned markets.

In Hong Kong, where M&S has traded since 1988, the retailer says "business is profitable, has strong brand awareness, an established store estate of 27 stores and a loyal customer base".

Al-Futtaim has worked in partnership with M&S since 1998 when it opened the first M&S store in Dubai. Today, Al-Futtaim operates 43 Marks & Spencer stores across seven markets in the Middle East, as well as in Singapore and Malaysia.

A successful conclusion to the discussions on the potential purchase and franchise, which includes commencing a period of due diligence, expected to take several months to complete, would see Al-Futtaim become the new sole franchisee for M&S in Hong Kong and Macau. However, M&S's Hong Kong sourcing-based operation will remain wholly-owned.

"In November we set out our plans to create a more sustainable, profitable and customer-centric International business for M&S by focussing on our established partnerships," explains Marks & Spencer's international director Paul Friston. "Al-Futtaim is a key partner to M&S in Asia and the Middle East and we are both committed to putting the customer at the heart of everything we do. With significant scale and retail expertise in the region, we are looking forward to discussing the potential extension of our partnership to Hong Kong and Macau as we continue to grow and develop our business together."

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Established in 1884, Marks & Spencer today trades in 50 markets, with over 400 stores and an online presence in 25 markets.