David Jones Takeover Gets Nod From Feds
The regulatory green light follows approval by DJ’s shareholders of the $2.2 billion Woolworths takeover deal earlier this week, worth $4 per share, by an overwhelming majority.
The Federal Court yesterday made orders approving the scheme of arrangement under which Woolworths through its Australian subsidiary, Vela Investments, will acquire all David Jones shares.
The Court’s orders will be lodged with the ASIC today and the deal will become legally effective.
David Jones’ shares are to be suspended from trading on the ASX at the close of trading, today.
Shareholders will get their payout next week.
But the takeover bid, in the pipeline since earlier this year, wasn’t all plain sailing.
Premier Investments boss, Solomon Lew had, of late, built just under 10% shareholding in David Jones, acting as a possible stumbling block to the takeover by the South African retailer Woolworths, whom Lew had beef with in the past.
Doubts had been raised by ASIC following Woolworths’ recent agreement to purchase Lew’s minority stake in another retailer, Country Road, which he has been looking to offload for some time. Woolworths holds a majority share in Country Road.
Regulators suspected the $213 million Country Road buyout was a carrot to Lew, who may have otherwise opposed the David Jones takeover and feared the Australian retail boss was set to benefit more from the deal than other shareholders.
He is also set for a massive $212 million payout from the DJs deal.
However, in the end Justice Farrell approved the deal following the massive approval by DJ’s shareholders and Lew abstention from the vote that took place on Monday, reports Fairfax Media.