Valuable Penneys’ Chain
p. 21 · Read in the full issue
Burns Philp & Co. Surprise
The Experts
Sold To Australian Co.
Big Islands business is adding unexpectedness to its other qualifications for fame. The recently announced sale of Pennevs’ chain stores (owned entirely by Burns Philp and Co. Ltd.) to G J Coles & Co. Ltd. has left the financial quidnuncs of Australia gasping that it is the most sensational retail deal in Australian history.
IT is supposed, also, to be the biggest retail deal ever—price offered by Coles is undisclosed but it is “believed to be over £5 million.”
All but 10 of the 48 Penneys’ stores are in Queensland where the business has been entrenched for many years. The odd 10 are in NSW, mostly in the north but one is in a Sydney suburb. It is believed that when BF’s acquired the Imperial Arcade property in the heart of Sydney city a number of years ago that the intention was to open a Penneys’ there.
Penneys has been a similar kind of chain to Coles (a “Woolworths” type of store). Before the war, Coles chain traded on the slogan “Nothing over 2/6”—however post war inflation appears to have put an end to that; many new depart ments have been added although the policy is still best value for the least money. In recent years, Coles has not confined itself to this type of merchandising (although it has acquired two other chains, Selfridges and F and G); a year or so ago it bought Mantons, in Melbourne—a medium class departmental store.
The most surprising aspect of the new deal is in BFs decision to sell, as this seems to be a direct break with post-war policy when the big company has diversified its interests by buying large country stores.
It will be interesting to see— providing much of the price is in cash—to just what section of Ts large empire Burns Philp will turn its new liquid assets.
Penneys' last balance sheet (June 30 1955) showed paid-up capital of £1,787,534 (all owned by BP); Net tangible assets, £2,990 449 profit of £161,338; a dividend of 10 per cent! absorbing £143,002; and freehold property held by the company valued at £1,963,070.