The South African department store group paid $2. 2 billion for David Jones and was forced to outlay another $212 million to avert the threat that Solomon Lew would block its bid by taking him out of Country Road, so it has the best part of $2. 5bn riding on its ability to significantly improve David Jones’ performance.
It should be said that, after a rocky start four years ago when he replaced the highly-regarded Mark McInnes in unusual circumstances (allegations of sexual harassment), Zahra has recently presided over a period of improved performance by David Jones within the context of a very difficult and brittle retail environment.
Woolworths can’t afford anything other than a seamless execution of its planned major changes to David Jones’ retail strategy, which include a massive increase in the proportion of store-owned brands in the stores in line with Woolworths’ own highly-successful retail offer.
There is a view that David Jones shareholders received a share of the prospective synergies Woolworths plans to generate from the acquisitions, so there is a very significant and urgent need for Woolworths’ to hit the ground running and execute its plans perfectly.
Read more here: Business Spectator