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David Jones Limited A.C.N. 000 074 573 A.B.N. 75 000 074 573
David Jones will appoint an independent expert to prepare a report on whether the Proposal is fair and reasonable and in the best interests of David Jones shareholders. The independent expert’s report will be included in the Scheme Booklet which is expected to be distributed to shareholders in late May 2014. Woolworths’s Chief Executive Officer, Ian Moir, said: “We believe that David Jones is a truly iconic Australian retail business. Woolworths is a very similar business, closely aligned in terms of our target markets and our values. The combination will create a leading southern hemisphere retailer with meaningful scale, able to leverage common fashion seasonality with enhanced sourcing capability. We will work with the David Jones team to deliver the sound strategies they have already set in place. Woolworths will bring extra capability, financial strength and significant scale to accelerate these strategies and offer a greatly enhanced value proposition, delivering on-trend product within the most exciting and innovative shopping experience in the market.” The implementation of the Scheme is subject to conditions including:
the requisite majorities of David Jones shareholders approving the Scheme (being a majority in number of shareholders who vote and at least 75% of the total number of shares voted);
approval from the Treasurer of the Commonwealth of Australia under Australia’s foreign investment rules;
no material adverse change, a force majeure event, prescribed occurrence or regulatory restraint; and
Court approval of the Scheme. Further, unless an independent expert concludes that the Scheme is fair and reasonable and in the best interests of shareholders, David Jones is not obliged to proceed with the Scheme. Shareholders should be aware that the Scheme is also subject to Woolworths shareholder approval that requires:
at least 50% approval based on the total number of shares voted in relation to the proposed acquisition of David Jones; and
at least 75% approval based on the total number of shares voted in relation to an equity raising Woolworths is intending to undertake once the Scheme has been implemented. The Scheme is also subject to Woolworths obtaining South African Reserve Bank approval. The SID contains customary exclusivity provisions including no-shop and no-talk restrictions as well as a notification obligation, with the no-talk and notification obligation subject to the David Jones directors’ fiduciary obligations. The SID also details the circumstances in which David Jones may be required to pay a break fee to Woolworths, and the circumstances in which Woolworths may be required to reimburse David Jones’ costs in relation to the transaction. Full details of the conditions to the Scheme and other agreed terms are set out in the SID, a copy of which is attached to this announcement.
Shareholders do not need to take any action at the present time. It is anticipated that Woolworths shareholders will have the opportunity to vote on the proposed acquisition and in relation to the contemplated post-transaction equity raising at a meeting to be held in South Africa in mid June 2014.