Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Brierley creeps up his Kirkcaldie stake

Brierley creeps up his Kirkcaldie stake, ahead of David Jones' payday

By Suze Metherell


Oct. 16 (BusinessDesk) - Veteran corporate raider Ron Brierley has lifted his stake in Kirkcaldie & Stains for the third time since Australia's David Jones announced plans to take over the unprofitable Wellington department store.


Brierley increased his holding in Kirkcaldie to 9.4 percent from 8.4 percent via his ASX-listed investment vehicle Mercantile Investment Co, buying 106,000 shares for a total of $233,000, or $2.20 a piece, on market last week, according to a substantial holding notice lodged with the NZX. In June, Kirkcaldie announced it will shut up shop after 152 years as it entered into a deal with South African-owned David Jones. Since then the corporate raider has incrementally increased his stake, spending $199,317 in June to lift it to 6.9 percent from 5.7 percent, and a further $296,253 in July taking his stake to 8.4 percent.


David Jones will use the prime Lambton Quay location on Wellington's "golden mile" shopping precinct for its first New Zealand store, freeing up Kirkcaldie's board to return cash to shareholders.


Like many bricks-and-mortar stores, Kirkcaldie has been forced to discount stock to compete with online rivals. Department stores in particular have come under pressure, including David Jones, which was taken over by South Africa's Woolworths Holdings and delisted from the ASX last year after sales and profitability fell. Kirkcaldie has been unprofitable for seven years.

David Jones will pay A$400,000 for the Kirkcaldie & Stains name and take over the lease of its flagship store, with the option to buy the retailer’s assets for NZ$500,000 within 25 working days. The company’s stock, valued at $8.3 million as at May 31, is not included in the sale and the company plans to sell any remaining stock from its Thorndon Quay furniture store after exiting its Lambton Quay store in February.


The New Zealand retailer had $18 million in cash and equivalents as at June 4 after selling its neighbouring Harbour City Centre. The rest of the proceeds went toward paying off $23.5 million in bank debt. Kirkcaldie will receive a final $4.75 million instalment on the sale in October.

Kirkcaldie shares surged as high as $2.29 after the David Jones announcement from $1.68 prior to the deal, having slumped to a record low $1.58 late last year. The stock last traded at $2.20.


Brierley first emerged as a substantial holder of Kirkcaldie in 2011 when the company's shares were seen trading at a discount to the value of the company's real estate, the Harbour City Building. Around that time, former Brierley Investments chairman Selwyn Cushing and his son David Cushing lifted their family’s stake in the retailer to 17.1 percent and currently hold 19.5 percent, according to the Companies Office. The Cushings and Brierley are known for buying undervalued assets.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Tourism: Employers Welcome Back Working Holidaymakers

Tourism businesses gearing up for the return of Australian visitors from next week will be relieved to learn that they will also have access to an offshore pool of much-needed job candidates, Tourism Industry Aotearoa says. Tourism employers around ... More>>

Commerce Commission: Latest Broadband Report Confirms Improved Performance Of Premium Fibre Plans

The latest report from the Commerce Commission’s Measuring Broadband New Zealand programme shows that the performance of Fibre Max plans has improved substantially. This follows a collaboration between the Commission, its independent testing partner, ... More>>

Air New Zealand: Capital Raise Deferred

Air New Zealand has decided to defer its planned capital raise to later in 2021 allowing more time to assess the impacts of recent developments on the airline’s path to recovery. 'We’ve seen some clearing of COVID-19 clouds recently, with ... More>>

Commerce Commission: Cartel Conduct Now Punishable By Up To 7 Years’ Jail Time

Cartel conduct can now be punished with a term of imprisonment of up to 7 years, after the Commerce (Criminalisation of Cartels) Amendment Act 2019 came into effect today. Cartel conduct includes price fixing, market allocation and bid rigging (see ... More>>

Stats NZ: New Report Shows Impact Of Demands On Land In New Zealand

A new environmental report released today by the Ministry for the Environment and Stats NZ, presents new data on New Zealand’s land cover, soil quality, and land fragmentation. The land cover data in the report, Our land 2021 , provides the most ... More>>

ALSO:

Stats NZ: March Card Spending Rebounds Despite COVID

There was a lift in retail card spending in March following a fall in the lockdown-disrupted February month, Stats NZ said today. Seasonally adjusted retail card spending rose by $53 million (0.9 percent), compared with February 2021. Visit our website to read ... More>>

PwC: Outcome Of Review Into Air New Zealand Gas Turbines Business

Air New Zealand has received the report into its Gas Turbines business from independent external advisers PwC. Air New Zealand Chairman Dame Therese Walsh says the report identified a range of effective controls in the Gas Turbines revenue contracting ... More>>