Wesfarmers divests from Kmart Tyre and Auto Services
The group estimates it will report a pre-tax profit on the sale amount of approximately $270 million to $275 million, subject to completion adjustments. Continental AG will continue to trade under the KTAS brand for a transitional period after the sale.
Wesfarmers managing director Rob Scott noted the sale adds value to shareholders from the business turnaround.
“We believe that the divestment is in the best interest of Wesfarmers’ shareholders, while giving the employees and customers of KTAS the opportunity to join a highly complementary business in Continental,” said Scott.
“I thank all of the KTAS team for their outstanding efforts in growing and improving the business under Wesfarmers’ ownership and, in advance, for their continued focus and commitment during the transition to new ownership.”
KTAS has 258 stores across Australia, with 1200 employees, and is the largest single employer of apprentice motor mechanics in Australia.
Continental’s Tire division is a technology leader in tyre production and offers a broad range, from passenger cars, commercial and two-wheelers. The company’s portfolio also includes fleet applications, as well as digital management systems for commercial vehicle tyres.
Subject to satisfying sale conditions, the divestment is expected to be completed in the first quarter of the 2019 financial year.