With Icelandic retailer Bauger Group and property magnate Ardeshir Naghshineh linked to Woolworths Group plc by a combined stake of 22.2% the board have finally replaced their CEO Trevor Bish-Jones with the former marketing director of Asda plc and ex-boss of Focus DIY Stephen Johnson.The timing of the appointment, just four days after the Iranian-born property tycoon, Naghshineh upped his stake in the company to over 10%, will not have gone unnoticed by canny investors who may now see a full scale bid for one of Britain’s most well known retail brands less likely.
The attraction of Woolworths Group plc to both ever expanding Bauger Group and property investor and developer Nagshineh, who controls the private property company Targetfellow, is obvious. Woolworths has more than 800 mainly leasehold and freehold properties in virtually every major town and city in the UK. It doesn’t take a rocket scientist to work out that there is potential for a symbiosis there.
At today’s closing price of 6.38p, down (16%) on the price recorded the day before Johnson’s appointment on Tuesday, Woolworths Group plc trades at a discount to Net Assets of a little under 15p.
Prospective suiters whether they be eying the company's property assets, or some of Woolworths’ sought after city retail sites, will now be contemplating whether Stephen Johnson will be able to deliver the turnaround he has been employed to pull off.
Long term investors will be hoping that the new broom will unlock the value inherent in Woolworth’s balance sheet and return Woolworths, with a turnover of nearly £3 billion to the respected retail giant it once was. Short term holders, however, may be feel a tinge disappointed.
Stephen Johnson will take up his post as Chief Executive of Woolworths Group plc on the 1st September 2008.
This can also be read at money.co.uk
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