Strong interest in FoodWorks corporate stores despite low market expectations.
When FoodWorks decided to sell the 22 outlets they acquired as corporate stores in the last nine months, they turned to Aussie Supermarket Brokers to help them access the largest number of potential buyers and achieve the best price.
Aussie Supermarket Brokers have already secured contracts on three of these stores on behalf of the company in Queensland and New South Wales, and are in serious negotiations with interested buyers for several other stores.
“When FoodWorks decided to divest their corporate stores, we were delighted that they turned to us to help them achieve their aims of a reasonably quick sales process and the best sales price.
Some of the market did not believe that these stores were saleable, however twelve expressions of interest have resulted in three contracts and more contracts are expected to go through in the coming days. Despite current somewhat flat trading conditions in the marketplace, we have found no shortage of buyers that recognize the opportunity that these stores represent” said Aussie Supermarket Brokers’ General Manager, Daniel Bonney.
Bonney attributes the quick results to Aussie Supermarket Brokers’ database of over 6,000 potential supermarket purchasers, most of whom received notification that the stores were on the market within hours of the broking firm being asked to manage the sales process.
FoodWorks issued the following update to the National Stock Exchange of Australia on 22nd June 2010:
Corporate Store Divestment Update
FoodWorks is pleased to provide the following update on its corporate store divestment program previously foreshadowed to the market on 16 March. The process undertaken by FoodWorks is consistent with that explained at the various members’ meetings held around Australia.
FoodWorks has taken appropriate steps to ensure a transparent and competitive store sale process, including the extinguishment of Metcash’s first right of refusal over the sale of the stores. Today we are pleased to announce we have signed conditional sale and purchase agreements to divest six FoodWorks company owned stores to a number of purchasers.
The agreements provide that three of these stores, two in NSW and one in Qld, will be sold to independent retailers who are within the FoodWorks network or will operate the stores as FoodWorks retailers. Agreement has been reached for three stores in NSW to be sold to a non FoodWorks retailer. Significant progress has been made in the sale of a number of other stores, and we would expect to make further announcements shortly.
FoodWorks is still accepting and evaluating offers for the remaining stores and is pleased that interest from prospective buyers has been strong. Where it creates value further stores will be divested, in the meantime the stores will remain operating as FoodWorks corporate stores.
FoodWorks will be working with the purchasers and other relevant parties to support the store teams concerned, and will provide further updates to the market as appropriate.