This article is from the Australian Property Journal archive
PREMIER Investments’ combative chairman Solomon Lew has thrown down the gauntlet to Myer, instructing lawyers Arnold Bloch Leibler to request a copy of the struggling department store’s shareholder register ahead of calling an extraordinary general to overhaul the board.
Lew, through Premier, last week upped his major holding in Myer from 10.8% to 15.77%, prompting Myer to offer board representation as the long-running feud moved into a more aggressive phase.
Pressure from Lew and second-largest shareholder Geoff Wilson of Wilson Asset Management last year forced Myer chairman Gary Hounsell to step aside just hours ahead of its annual general meeting. It had already decided to reduce the number of directors on its board under pressure from Wilson, after revealing a $172 million full year loss as the pandemic smashed in-store trading.
“In Premier’s view, Myer’s three remaining non-executive directors should for once put its shareholders first and resign immediately. Any other action would be futile, and costly for Myer shareholders who have endured enough,” Premier said in a terse ASX statement on Friday.
The retail group – owner of Peter Alexander, Smiggle and Just Jeans – said it has commenced consultation with other Myer shareholders “regarding the quick reconstitution of a majority independent Myer board with the necessary skills and experience”.
Premier has also retained proxy solicitation firm Morrow Sodali to collect proxy votes.
Billionaire Lew made a $100 million investment in Myer in 2017 when the share price was at $1.15. It has fallen as low as 19c, and closed on Friday at 44c.
CBD stores hurt Myer’s first-half sales numbers as workers were slow to get back to the office, while online sales lifted 71% have doubled in their representation of Myer’s total sales over the past year to 21%. As well as added investment in online, its current CEO John King is planning on slashing floor space by 110,000 sqm through store closures or relinquishing excess space as part of his bid to cut costs.
Leases across more than 190,000 sqm worth of floor space expire within three years.
Premier has so far sailed through the pandemic with flying colours and is expecting to almost double its full year profits on the back of strong online sales, control over its supply chain, and favourable rent agreements with landlords. Combative Lew has been at the vanguard of tenants pushing for rent relief throughout the pandemic.
The group has also just poached JB Hi-Fi chief executive officer Richard Murray to take up the role as its own CEO.
