Greencross considering sale of company
The retailer confirmed the rumours in a statement to the ASX, following a report in the AFR that suggested a private equity firm was looking to purchase the struggling business.
“The proposals are subject to a number of conditions and are expressed as being non-binding and incomplete,” Greencross’ head of investor relations Robert Wruck said in a note to investors.
“The proposals are required to be kept confidential, and there is no certainty that any proposal will result in a transaction involving Greencross, what the terms of any such offer would be, or whether there will be a recommendation by the Board of Greencross.”
The company’s net profit dropped 51 per cent to $20.7 million in FY18, due to a sizeable write-down of exceptional items, signalling a year of “substantial change”.
But the recent interest from private equity investors would appear to back up what Greencross chief executive and managing director Simon Hickey asserted in August – namely, that the company’s mix of retail and services and highly engaged customer database are a potent mix.
“We have an unrivalled integrated pet care platform and the new management team is excited by the opportunities to grow market share by leveraging our unique retail, vet care and service offering and our 1.9 million active loyalty members,” Greencross chief executive and managing director Simon Hickey said when the company released its earnings in August.
Hickey noted the group’s loyalty program as a key strength and an enormous opportunity to be leverage; with 90 per cent of retail sales already coming through the platform.
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