Harvey Norman Pockets $4M Profit From Gazal Sale
Disclosed in an ASX announcement today, Harvey Norman has sold its 7.2% stake in fashion and apparel business, Gazal, for $10.4 million – a deal which has pocketed ~$4 million in profit.
Harvey Norman’s stake in Gazal is part of its “share trading” portfolio, which operates in addition to traditional retail stores. The company reportedly bought into Gazal in late 2016.
As per The Australian, the transaction has triggered a pre-tax profit of ~$4 million for Harvey Norman.
The company’s initial shareholding in Gazal reportedly cost ~$6.5 million.
Gazal is controlled by Michael and David Gazal, and represents several brands (e.g. Pierre Cardin, Tommy Hilfiger and Calvin Klein) largely through licensing agreements.
The fashion and apparel group posted a 21% net profit increase of $5.4 million, for the seven months to February. Revenue for the period reportedly jumped 22% to $144.6 million.
Both Harvey Norman and Gazal have Graham Paton appointed as a Director.
The news comes shortly after Harvey Norman Chairman, Gerry Harvey, rebuffed criticism for investing company funds into other businesses, including the now collapsed Coomboona dairy farm joint-venture.