Edcon expresses interest in Myer stores in Australia
31 August 2005
Following an announcement earlier this month by Australian holding company Coles Myer Ltd that it would consider ‘ownership options' regarding its Myer chain of stores, Edcon will be forming a team in South Africa and Australia to explore any possible opportunities for the company.
"Australia is a large market in the Southern Hemisphere and if Coles Myer decides to divest Myer then we want to be in a position to determine if an acquisition of Myer would create value for Edcon shareholders," said CEO Steve Ross.
Ross said that the team would conduct an evaluation to explore any apparent similarities between Edcon and Myer relative to market position, brand components, product sold and product seasonality. These may support improved purchasing leverage for Edcon, as well as increased sourcing opportunity, international brand management and operating economies of scale of the combined business.
"We have a disciplined approach to acquisitions and we will carefully evaluate all issues in regard to any potential international diversification in our core business," said Ross.
Myer is the largest chain of department stores in Australia and has 61 stores around the country. Their annual turnover is A$3.1 billion and their market share in Australia is similar to that of Edgars in South Africa, at roughly 20%.