Myer acquisition on Marcs and David Lawrence does not cover staff obligations
Myers has saved Marcs and David Lawrence after the two most popular brands in Australia went into administration in February. The acquisition would include the existing inventory, brand names and intellectual property of the retail stores. However, lease liabilities and staff obligations were not included in the acquisition.
Daniel Bracken, chief merchandise and customer of Myer, said that the company stepped in a week ago after the administrator could not find a buyer for the fashion labels. “These brands are very very successful brands at Myer, both are considered part of our wanted brands strategy and both are highly productive (with high sales per square metre). They tick two major boxes,” Bracken told The Australian Financial Review. He said that they did not want the company to leave the business as it ticked the box of being desired brands and it also ticked the box of being highly productive brands in terms of strong sales.
Bracken said that the company has been watching the situation hoping that the fashion labels would be acquired. However, they realised that they could not find a buyer. He described that the company was heading down the track of a potential wind up. He added that Myers has a good business with the fashion labels and they wanted to protect the business.
The Retail Doctor retail consultant Brian Walker described the move made by Myers was a smart purchase. He thought that the company has been prudent in the way they have negotiated it and their acquisition was about the brand name without any obligations on lease costs, overheads and employees.
Rodgers Reidy administrators Geoff Reidy and Andrew Barnden said that there were 36 stand-alone Marcs and David Lawrence stores and outlets that would close over the coming week while there would be 130 casual staff who would lose their jobs. Still, there would be 12 stand-alone stores and 115 concession stores that would continue to trade. Before administration, there were 52 stand-alone Marcs and David Lawrence stores, 11 outlet stores and 140 concessions and the company employed more than 1000 staff.
David Jones spokesman confirmed that it was business as usual for the acquired companies. The spokesman said that the acquisition was a positive outcome for two great Australian brands and their employees. However, investors and analysts have seen the move as a response to Solomon Lew’s stake. Bracken denied it by saying that there was no any link to the stake.
First Published on International Business Times on April 14th 2017