Local shareholders give the thumbs up

On the local front we had the Woolworths shareholders suggesting that the South African shareholder base had given the board and company the necessary authority to proceed with the David Jones acquisition down under. Overwhelmingly, although not all resolutions, number 4 only got 97 percent, whereas the other resolutions gained in excess of 99 percent of the votes. I tried to look on the Woolies website under investor relations for the specific circular, but alas, it was not there to be found.


So what next? Well, Woolies now has to see the other folks, the David Jones shareholders are going to vote on the matter. As per the original times and dates in the initial SENS, this happens on the 30th of this month, in just under a fortnight. And because the time difference between Australia and here, we should know before market opens here in two Mondays time.


The purchase price is still, as it stands in Rand terms, a sizeable 21.5 billion. The funding thereof I guess will only be announced post a successful David Jones shareholder vote. But is it as easy as that? No, according to the Sydney Morning Herald (my favourite acronym - SMH), a fellow by the name of Solomon Lew (who as the article points out owns 11.8 percent of Country Road) has acquired 10 percent of David Jones in his personal capacity. Huh? Check it out -> David Jones a hostage in 17-year Country Road war.


So it seems that because of the relationship between Woolworths and the Solomon Lew fellow that David Jones is not a done deal and it could go down to the wire. Of course my knowledge of Australian corporate laws and takeover percentages is very sketchy, but as Paul pointed out, it is probably the same as here, coming from British law. As the article points out, Lew does not have the ammunition, he can put up a big fight, but unless he has another 15 percent of shareholders on his side to reach the three quarters majority to give the blessing to the deal, he might find himself with a marginal score, because he quite possibly bought these shares just below the Woolworths bid for David Jones.


I am not sure, all you need to know is that the deal is not a deal until the money is in the till, that is what a fabulous old client once told us! The sad part is that he is no longer with us, but the saying lives on!