Metcash picks up 50% stake in Mitre 10
Metcash Limited (MTS) said it had agreed to take a 50.1% stake in hardware chain Mitre 10 for around $55 million, as Australia’s number three supermarket chain seeks to compete against Bunnings and Woolworths' new hardware venture.
The company said the sum was an estimate based on earnings predictions for the current financial year, and the final figure wouldn’t be known until the books have been finalised after June 30 next year.
Metcash said it also retained the right to pick up the remaining 49.9% stake for a sum based on 2012 and 2013 earnings multiples.
Andrew Reitzer, CEO of Metcash, said he was delighted by the move.
“We can become the ‘champion of the independent hardware retailer’ and help them lift their revenue and profit through Metcash’s strong brand management, logistics and merchandising skills developed over many years,” Mr Reitzer said.
At the close Wednesday, Metcash shares were trading at $4.40.
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