Reuters – David Jones Suitor Stands by $1.7B Bid

The mystery UK private equity company behind a takeover approach for Australia’s No.2 department store chain David Jones has said its bid is real, Australian media reported on Monday, Reuters wrote over the weekend. David Jones said on Friday it had received an unsolicited bid from a consortium led by EB Private Equity, a firm it said it did not know much about and was unknown to many market players, prompting speculation the bid was a hoax. EB Chairman John Edgar has told Australian newspapers that his company first offered A$1.52 billion ($1.56 billion) in a letter to the board of David Jones in May and increased that last week to A$1.65 billion, but had not expected the initial approaches to be made public.

(Reuters) – The mystery UK private equity company behind a takeover approach for Australia’s No.2 department store chain David Jones has said its bid is real, following questions about its business and assets, Australian media reported on Monday.

 

David Jones said on Friday it had received an unsolicited bid from a consortium led by EB Private Equity, a firm it said it did not know much about and was unknown to many market players, prompting speculation the bid was a hoax.

 

EB Chairman John Edgar has told Australian newspapers that his company first offered A$1.52 billion ($1.56 billion) in a letter to the board of David Jones in May and increased that last week to A$1.65 billion, but had not expected the initial approaches to be made public.

 

“We think the offer is a good one and it stacks up both on a technical level and practical level, and approached David Jones with the idea of discussing that,” Edgar was quoted saying by the Australian Financial Review.

 

He said he hoped to discuss the bid with David Jones Chairman Bob Savage this week.

 

Edgar said EB, with $200 million of funds under management, had spoken to financial institutions and investors about joining the bid for David Jones.

 

“Things are at too preliminary a stage for things to be formulated and firmly in place,” he told the AFR.

 

Edgar, who told The Australian newspaper EB was a property-oriented fund that had done deals in Europe, Africa and North Africa, said EB was mostly interested in David Jones’ real estate and had no experience in running retail businesses.

 

“We didn’t anticipate such a fuss,” Edgar told The Australian.

 

David Jones shares surged 15 percent on Friday to A$2.59, but that was well below the offer price of A$3.12 a share, reflecting scepticism in the market about EB Private Equity, whose website had scant information about its business.

 

David Jones has said it is still seeking information on EB Private Equity.