Woolworths Limited has just announced the signed share sale agreement for the divestment of Dick Smith Electronics, with private equity firm Anchorage Capital Partners coming on board.
The agreement states that Anchorage will purchase 100 per cent of the business including all 325 stores employing 4500 people.
Initial cash proceeds will be $20 million to be received in FY13 with Woolworths potentially benefiting from any upside resulting from a future sale of Dick Smith by Anchorage.
The sale means that Woolworths will no longer have a specialty consumer electronics business. Woolworths CEO, Grant O’Brian, commented on the sale.
“We announced the company’s strategic priorities in November 2011 which included a review of our portfolio of assets, particularly our participation in the consumer electronics category, with a view to maximising shareholder value. These businesses were a small part of Woolworths and this divestment will allow us to be fully focused on the core parts of our business,” he said.
In a statement issued to the ASX, it is stated that Dick Smith will continue to trade as a specialty consumer electronics brand.