Why is Solomon Lew so obsessed with Myer? The saga started many years ago and for an interesting chronology from 1995 to 2002 please see this article.
Will Solly ever let go of Myer?
I received an enquiry from a mainstream publication in South Africa on Wednesday.
It read as follows:
What do you think Solly Lew is doing with that Myer stake?
My response was as follows:
Solly definitely has a “thing” about Myer and will continue to conduct his raids to increase his stockholding. If you look at the history going back over 40 years, Solly has always been involved with Myer. His recent sortie is just one more chapter. At one stage he was cooperating with DJ’s to buy Myer. Nowadays things are different with South Africans (Woolworths) owning DJ’s and what Solly wants to prevent is a Woolworths/South Africa takeover of Myer. Hence him continuing to increase his stake.
A further query was received:
Stuart, thanks so much. One more thing, if I may – why would Woolworths (or any other suitor) go after Myer?
And my response:
Well, for the same reason that Myer went after DJ’s in 2014.
The takeover bid by South Africa’s Woolworths is excellent news for shareholders of David Jones, but not such good news for rival operator Myer. Slapping Myer and David Jones together made sense for Myer. Now, way out of left field, Woolworths SA has bobbed on the scene and the David Jones board has accepted its offer of $4 a share.
And so the Solly show goes on and on and on.
Solly is a very clever and wealthy man and while there may appear to be some vengeance in his share raids, Solly is too smart to let his ego get in the way of his bank balance. Sure, he certainly has a penchant towards Myer.
Apart from his financial acumen, he made a great acquisition when he snapped up Mark McInnes who David Jones let go. If Solly gets control of Myer, guess who will run it.
The million dollar question is whether the department store pie is big enough for both Myer and DJ’s given the retail landscape in these times and the significant and increasing competition, especially from outside Australia. If not, who will blink first?
Stuart Bennie is a retail consultant at Impact Retailing www.impactretailing.com.au and can be contacted at firstname.lastname@example.org or 0414 631 702