Solomon Lew’s Premier Investments tightens its grip on Myer
The billionaire retailer now has 31 per cent of the company in his back pocket as his stalking of the department store enters its eighth year and possible end game.
Billionaire Solomon Lew has used creep provisions to snatch another 3 per cent of Myer for his listed fashion and investment vehicle Premier Investments, to tighten his grip on the department store and possibly gain a second board representative.
In late trading on Thursday Premier Investments bought up 2.95 per cent of Myer after paying 75c per share to take the Lew-controlled company to 31 per cent of Myer, at a time when the retailer is preparing to hand over to a new executive chairman in former Qantas loyalty chief Olivia Wirth.
Premier Investments, the public company that holds the bulk of the Lew family wealth through its ownership of fashion and retail chains such as Portmans, Smiggle, Peter Alexander and Just Jeans, as well as large equity stakes in kitchen appliances maker Breville, first pounced on a 10.77 per cent stake in Myer in 2017.
Since then it has been steadily climbing up the register, scooping up shares when large blocks became available, and more recently due to its large stake using ‘creep provisions’ to buy 3 per cent every six months instead of being made to trigger a full takeover of the department store owner.
Shares in Myer were trading at around 72c on Thursday, with Premier Investments paying a small premium for its next 3 per cent parcel of stock. With Premier now holding 31 per cent of Myer, that stake is worth $185.66m.
The latest inching up the share register comes at an interesting time for Myer with its current chief executive John King to depart in June and be replaced by Ms Wirth, who is currently Myer chairman and will have more power than her predecessor with the title of executive chairman to bestowed upon her when she takes the reins.
Currently Premier Investments director Terry McCartney sits on the Myer board and he was recently joined by former Premier Investments director and Lew ally Gary Weiss, who is Myer deputy chairman and lead independent director. It is unclear if Premier Investments will seek a second director on the board now that it owns 31 per cent of Myer.
The growing stake in Myer also comes at an interesting time for Premier Investments as it considers a planned demerger of its sleepwear retailer Peter Alexander and stationery store Smiggle into newly-listed companies where both brands – unshackled and autonomous – can chase higher growth opportunities, especially overseas.
Under the new strategy unveiled by Mr Lew in late March, Premier Investments will emerge with a stable of assets ranging from stakes in the demerged Peter Alexander and Smiggle brands, and its existing legacy retail chains, to large equity stakes in Breville and the now higher stake in Myer.
Ultimately this could see, some analysts have speculated, that Premier Investments could then backdoor list its fashion brands into Myer.
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