Firm sells David Jones for $120m after paying $2b eight years ago

By admin On Dec 19, 2022

Upmarket department store David Jones has been sold by its South African owners for a small percentage of what the firm paid nearly a decade ago.

South African-owned Woolworths Holdings Limited (WHL) bought David Jones in 2014 for a whopping $2 billion.

Today the store was bought out by Anchorage Capital Partners who paid between $120 million and $150 million, according to the Australian Financial Review.

AFR SYDNEY. GENERIC DAVID JONES SOLD SIGN RETAIL FIGURES DEPARTMENT STORES CHRISTTMAS SALE TRADE Photo by Peter Rae. Friday 16 December, 2022 — David Jones has been sold by its South African owners for $100 million. (Peter Rae)

Current David Jones CEO Scott Fyfe will continue on with the company and support it through “its next chapter of growth”.

”David Jones has a storied history, immense brand value and unparalleled assets – including an attractive retail footprint, a loyal customer base, and dedicated employees,” an Anchorage spokesperson said.

“The Anchorage team will work closely with CEO Scott Fyfe and the talented David Jones management team on the next phase of its transformation.

“Under this team’s stewardship, David Jones is now profitable, cash-generative, and self-funding, and we are confident in David Jones’ next chapter as the retailer of the future with a seamless omnichannel experience.”

David Jones will enter a long-term lease at the Bourke Street store in Melbourne as WHL holds onto the property and expects to sell it in the next 12 months.

The final transaction for the retailer is expected to be completed by March 2023.

Part of Sydney's iconic David Jones building will be transformed into a complex of office space, retail stores and 101 luxurious apartments. — There are 43 stores across Australia and New Zealand. (Rhett Wyman)

WHL CEO Roy Bagattini said the deal is a “major milestone” for the company’s growth but attributed the sale to the “strategic” acquisition almost a decade ago not materialising as the firm had imagined.

“The strategic rationale at the time of the acquisition did not materialise to the extent originally envisaged,” he said.

“While David Jones has successfully executed on its turnaround, notwithstanding the COVID-19 disruptions, now is the right time for the business to operate under new ownership, while WHL refocuses on its core South African and Australian Country Road Group businesses.”

The 184-year-old retailer opened in Sydney and now operates 43 stores in Australia and New Zealand.

There are 7500 people employed by the retailer.