Fate of DJs takeover bid still a mystery
David Jones is urging its shareholders to approve a $2.
2 billion takeover despite a wrangle between its major investor and South African suitor.
The corporate watchdog has also become involved in the $2.2 billion bid for the department store chain by South Africa’s Woolworths.
Solomon Lew holds a 9.89 per cent stake in David Jones, and an 11.9 per cent stake in Country Road, which is majority owned by Woolworths.
The South African retailer and Mr Lew have had several disputes as joint owners of Country Road, and Woolworths has offered to buy out Mr Lew for $209 million if the David Jones takeover gets shareholder approval.
David Jones says the Australian Securities and Investments Commission (ASIC) has questioned it and Woolworths about the Country Road offer, indicating it is concerned it constitutes a benefit to Mr Lew for approving the David Jones takeover, but no other David Jones shareholders.
In a letter to its shareholders, the department store has admitted some of them may see the offer for Mr Lew’s Country Road shares as a reason to vote against the Woolworths takeover.
But it recommends they vote in favour, saying the Country Road offer is a separate issue, and the Woolworths offer for David Jones is in their best interests.
David Jones has also confirmed its shareholders will vote on the takeover proposal at a meeting in Sydney on July 14, despite no word from Mr Lew on whether he will accept either of Woolworths’ offers.
“Mr Lew has not provided any indication of his voting intentions in relation to the David Jones scheme,” David Jones said.