Woolworths to collect $20m from Dick Smith sale
- 27 September, 2012 10:49
Australian retail gaint, Woolworths (ASX: WOW), has found a buyer for its consumer electronics division, Dick Smith Electronics.
In a statement Woolworths confirmed it has signed a sale agreement with Australian private equity firm Anchorage Capital Partners. The transaction, which is expected to net the company $20 million in FY2013, will be complete by December 2012 following customary conditions.
Under the sale agreement, Anchorage Capital Partners will purchase 325 Dick Smith stores which employ more than 4500 staff. According to a Woolworths spokesperson, the company will now work with Anchorage and Dick Smith management to commence a "smooth transition" to new ownership.
Woolworths chief executive Grant O’Brien said in a statement that the Dick Smith businesses were a “small part” of Woolworths and the divestment will allow it to focus on core operations including Big W, BWS, Dan Murphy’s and Masters Home Improvement.
In January 2012, O’Brien confirmed the company’s intention to sell DSE following a $420 million restructure of the division. At the time, the company's founder, Dick Smith, feared that the chain could be sold to foreign owners.
"When you want endless growth only the biggest survive," Smith told AAP. "Little Australia won't have any ownership at all."
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