Australia’s upmarket department store David Jones will open offshore for the first time after announcing the takeover of Wellington’s oldest department store, Kirkcaldie and Stains.
The 152-year-old Wellington institution reported losses of $NZ6.3 million before tax last year — its seventh consecutive annual loss — on sales of $NZ31.3 million.
Rather than downsizing or divesting, the company decided to reassign its lease to David Jones in what Kirkcaldie and Stains chairman Falcon Clouston says is “in the best interests of the company, the staff, and our customers.”
Around $NZ20 million will be spent on transforming and rebranding Kirkcaldie and Stains after David Jones’ parent company, South Africa’s Woolworths Holdings, paid $NZ400,000 for the brand name and $NZ500,000 for the retail assets.
“We are proud to reinvigorate the historic retail space and maintain it as the home of New Zealand’s premium department store, when we open David Jones Wellington next year,” David Jones CEO Iain Nairn said.
“This is an exciting new venture for David Jones, giving us a significant initial presence in New Zealand’s growing market with a prime location in the thriving capital, Wellington.”
The deal is subject to a shareholder vote and meeting with Kirkcaldie and Stains investors next month, with plans to open mid-2016 if approved.
The store will undergo extensive refurbishment while preserving the heritage-listed frontage.
The foray into New Zealand improves Woolworths Holdings ambition to become the biggest retailer in the southern hemisphere.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.