Woolworths to sell department store chain David Jones to Anchorage
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The deal will remove about 17 billion rand (S$1.3 billion) of liabilities related to the David Jones store portfolio.
PHOTO: DAVID JONES/FACEBOOK
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SYDNEY – Woolworths Holdings agreed to sell Australia’s oldest department store chain David Jones to Anchorage Capital Partners, ending an expensive misstep for the Cape Town-based retailer.
The deal will remove about 17 billion rand (S$1.3 billion) of liabilities related to the David Jones store portfolio, with the final value of the deal to be determined by the end of March 2023, when the transaction is expected to be completed, Woolworths said in a statement on Monday. Its management expects to get more than the carrying value of the David Jones assets, it said.
Under former chief executive Ian Moir, Woolworths tried to replicate its successful South African upmarket food business in David Jones, but it did not work. In October, chief executive Roy Bagattini said the David Jones purchase did not make sense, with the two retailers being fundamentally different. Woolworths primarily sells own-brand goods and its Australian counterpart mostly offers other brands.
Woolworths will keep the flagship store in Bourke Street, Melbourne, which will be leased to David Jones on a long-term basis on market-related terms, it said. There will also be a transitional services agreement “for a period of time to ensure an orderly separation of David Jones from the group”. BLOOMBERG
