Caltex may revive property sales: analysts
Caltex’s new CEO could revive plans for a sale of its retail properties, analysts believe.
The newly-appointed chief executive of Caltex could revive plans for a sale of its retail properties, as the company is expected to keep a close focus on costs, according to Morgan Stanley analysts.
In a research note, analysts from Morgan Stanley say the announced departure of current Caltex boss Julian Segal will likely add some near term uncertainty to the medium term strategy, although this will depend on who next leads the organisation.
However, the analysts say that the sale of its properties could be back on the agenda.
“In the nearer term we expect the company to focus on costs and potentially look
to start divesting some retail property or at least set a process in place for this to
happen,” the analysts said.
Caltex last year explored a potential sale of between 15 and 25 per cent of its existing freehold site portfolio.
It said then the move to retain only some of the interest in the properties would enable the oil refiner and petrol retailer to benefit from market value and development gains.
However, a sale of its real estate portfolio did not proceed, due to what is understood to be the negative tax impacts on Caltex as a result of any divestment.
Investment banks known to be close to Caltex are UBS, Goldman Sachs and Grant Samuel.
The Caltex-branded convenience stores includes names like Star Mart and Woolworths and there are at least 700 existing Caltex convenience sites, with which Woolworths last year signed wholesale food supply agreement.
Morgan Stanley analysts said in a research note that the departure of Mr Segal when a suitable replacement could be found would be a major surprise to the investment community, as he had been leading Caltex for about 10 years.
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