Myer is more valuable after becoming once again independent from Coles
In August 1985, the Myer Emporium Ltd and GJ Coles & Coy Ltd merged, becoming the largest ever Australian Corporation. The merger did not work nearly as well as anticipated, a common fate for merged companies. In 2006 Myer was sold off to private equity. Within in a year the firm was worth an additional 1 billion, illustrating powerfully that free-standing companies often create more value than when they are part of a larger corporate structure.
More details are provided in a recent articles in the Australian.
Here are some excerpts from the article “Myer buyers put Coles to shame.”
The stunning Myer turnaround is a tribute to the successful implementation of basic retailing techniques by an experienced management team, as well as a board where six of nine directors have extensive industry experience.
The contrast with the former owner Coles Group, now a takeover target itself, could not be more stark.
Chief executive John Fletcher has an industrial services background at Brambles, while former Tesco executive Michael Wemms is the only director with a genuine retail background.
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Asked later by The Australian how Myer has changed under its new owners, he says there’s “more drive and enthusiasm”, and the management team is better.
Bails, though, will not specifically discuss the discredited previous owners.
“I have no comment on the past,” he says.