AUSTRALIAN regulatory authorities have started an investigation into the withdrawn £1.1bn offer by a Newcastle-based private equity company to buy the country’s second-biggest chain of department stores.
Shares in the upmarket David Jones, Australia’s oldest department store business, soared by around £107m in value on Friday when it revealed it had received a takeover bid by little-known EB Private Equity, which has bases in Tyneside and Luxembourg. But, when EB withdrew its offer, David Jones’ shares plummeted by around £90m.
Now the Australian Securities and Investments Commission (ASIC) is “examining the proposed takeover offer for David Jones” and had been “monitoring developments closely”.
Its statement added: “Consistent with its usual practice, ASIC is looking at potential issues regarding disclosure and trading in David Jones stock both by domestic and international parties.
“ASIC’s priority is to ensure market integrity is maintained and that markets are fair, orderly and transparent and that, if there has been a breach of the law, those responsible are held to account.”
In an exclusive interview with The Journal on Monday, EB’s chairman John Edgar said the bid was withdrawn because it had “become clear the board of David Jones didn’t want to engage with us”.
He said the offer was the second made to the group and that EB had been working on the bid for around four months.
There has been much speculation in the Australian Press about the bid, because of the scant details available about EB.
The business is not listed with Companies House and its website is registered to a mailbox company on Newcastle’s Low Friar Street.