EXCLUSIVE:Steinhoff Pull Out Of The Good Guys Deal, Cash Script Deal Tipped
EXCLUSIVE: Steinhoff International who were in the bidding for The Good Guys is believed to have pulled out, a move that is set to be a relief for Harvey Norman who faced competition in both the appliance and furniture and bedding markets.
The decision to not pursue The Good Guys is believed to have been made after the South African Company who are strong in furniture and bedding started looking at other acquisition targets in Australia.
Among the Companies that the group is believed to be interested in is Nick Scali a Company who last week delivered an updated profit announcement claiming that they are on track to deliver a full year profit of between $24 and $26M.
ChannelNews understands that the Muir family who earlier today announced that The Good Guys are going ahead with plans for an $800 million public offer despite strong interest from trade buyers are still concerned about having their business interests exposed during a public float process.
What is believed to be an option, is a deal with JB Hi Fi that would consist of a combination of cash and script.
Insiders at an advisor to The Good Guys have said that one option being considered is a combination of $500M in cash and $400M in JB Hi Fi script a deal that allows the Muir family to avoid a large Capital Gains Tax.
One financial advisor said “An all out cash deal could cost the Muir family between $180 and $200M in Capital Gains Tax, by taking 50% of the deal in script the family avoid paying the Capital Gain Tax upfront”.
“This type of deal allows the Muir family to then work out a tax minimisation program to minimise the impact of the Capital Gain Tax when they actually sell their shares”.
The Chairman of Muir Electrical who own The Good Guys, Andrew Muir said that he had appointed Credit Suisse, Goldman Sachs and UBS as joint lead managers, however the family are still keen to keep their business interests “private” insiders have said.