Almost eight years after it was first sold for around $2 billion, David Jones has been purchased by a private equity firm for a fraction of its original price.
The iconic Australian retailer will now be owned by Anchorage Capital Partners.
The deal, which was reportedly valued at around $100 million, was made by Woolworths Holdings Limited, the owner of David Jones.
Anchorage Capital Partners will acquire the business. David Jones is one of the leading retailers in Australia and is known for its omnichannel capabilities.
The company was founded in 1838 and currently has 43 stores in Australia and New Zealand, with around 7,500 employees.
Anchorage is a leading private equity firm that has extensive experience in the retail and consumer sectors. It has fully supported Scott Fyfe, the CEO of David Jones, and his management team.
The firm also plans to contribute to the company’s ongoing Vision 2025+ strategy by investing in the business.
The acquisition is expected to close by March 2023. According to reports, the company reportedly settled for around a tenth of what it was worth a decade ago, which is believed to be around $150 million to $120 million.
It’s not clear if the deal includes the company’s flagship store in Melbourne’s Bourke St. However, in November, Woolworths Holdings released a trading update that showed that David Jones was performing well.
In November, the company noted that its sales had increased by 55.3% during the period, as it was able to successfully implement its strategy of implementing extended lockdowns.
It also said that it was maintaining its positive outlook for the business. Scott Fyfe, the CEO of David Jones, will continue to lead the company.
As part of its ongoing strategy, the company is expected to continue investing in its stores and improve its online capabilities.
The company is also expected to reduce its office costs.
According to Gary Mortimer, a marketing professor at Queensland University of Technology, David Jones could be in the best shape it has been in a long time due to its modern stores and the increasing number of customers.
According to Mortimer, the company could also be in a better position to maintain its presence in the middle-to-high income segment of the market, as it would be able to attract more middle-class consumers.