Wesfarmers Pitch To Keep Officeworks & Bunnings Open As They Exit Coles
Wesfarmers who has not denied speculating that they are set to close down their loss making Target stores has said that they are selling a 5.2 per cent stake in Coles.
Currently the Company is pitching to keep their Bunnings and Officeworks stores open in Victoria and NSW open as State Governments, consider locking down all none essential retail. In NSW cases of Coronavirus have fallen to 117 a decline that has seen the Government decided to keep stores open.
NSW Premier Gladys Berejiklian wants to consider moving to close down all major retailers as part of her new, localised Covid-19 measures.
Both Officeworks and Bunnings have seen significant jumps in revenues during the past 4 weeks with management keen to stay open.
Their sell down of shares in Coles who are currently reporting record revenues will see Wesfarmers lose its right to have a seat at the board table of the demerged supermarket.
The sale will take Wesfarmers’ stake in Coles below 10 per cent, terminating the relationship deed agreed to with Coles at the time of the demerger, with Wesfarmers losing its right to nominate a director to the supermarket’s board.
As part of the transaction, Wesfarmer will retain its remaining shares in Coles for at least 60 days.
“We have been pleased with the performance of Coles since the demerger and the very important role that Coles is providing, and will continue to provide, to Australian households during the COVID-19 crisis,” said managing director Rob Scott.
“This divestment crystallises an attractive return for shareholders since demerger and further enhances Wesfarmers’ strong balance sheet position.”
Both companies will continue their FlyBuys joint venture, with both groups retaining a 50 per cent interest in the business.