The Myer board says Solomon Lew’s criticisms are a takeover ‘on the cheap’

  • The Myer board says Solomon Lew is trying to takeover the department store on the cheap.
  • The directors say Lew’s Premier Investment now can’t make a straight takeover because he told a TV news program he had ruled it out.
  • The only way he can get control is to spill the board, they say.

The battle for Myer escalated with the board of the department store taking aim at Solomon Lew, saying he’s trying to takeover on the cheap.

The board says comments by retail veteran Solomon Lew in a television interview preclude his company Premier Investments making an offer for the department store chain.

Lew made several comments concerning Myer which have not been contained in correspondence sent from Premier to shareholders, the board says.

“We have no interest in making a takeover bid …” Lew told the ABC. He went on the say “I am ruling it out …”

The Myer board says the effect of these comments is that Premier is prevented from making a takeover bid under ASIC’s Truth in Takeovers policy.

Premier Investments, the largest shareholder with 10.8% of Myer, has been agitating to spill the board of directors, and is now urging a vote against the remuneration report at the Myer AGM on November 30.

A second strike against, what Lew calls, a “failed” board of Myer would mean all director positions would be declared vacant.

However, Myer Chairman Garry Hounsell says Premier is trying to take control of Myer under the guise of seeking an “independent board”.

“Myer shareholders should be alarmed that Premier is trying to get Myer on the cheap for their own benefit,” he says.

“As we approach our important Christmas trading period, it is critical that we apply 100% of our focus and energy on our customers.

“It is for this reason that we are extremely disappointed by the actions of Premier Investments and their ongoing hostile media campaign, which impacts negatively on customers, team members and, ultimately, on our shareholders.

In September, Myer posted a 52% fall in underlying annual net profit to $32.47 million as the department’s store’s strategy to resurrect growth crumbled. Revenue fell 3% to $3.1 billion and sales were down 2.7% on a comparable store basis.

The company has been cutting costs, ditching managers and executives, negotiating rent reductions and renegotiating its loan deal with banks.