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Dick Smith anchors with private equity firm
Minter Ellison and Clayton Utz have acted on a complex private equity transaction in which Woolworths has exited the Dick Smith business.
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Firms: Minter Ellison (Anchorage Capital Partners); Clayton Utz (Woolworths)
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Deal: Australian private equity firm Anchorage Capital Partners has entered into a share-purchase agreement with Woolworths Limited to acquire Dick Smith Electronics
Area: Corporate
Value: Initial cash proceeds will be $20 million, to be received in FY13, with Woolworths potentially benefitting from any upside resulting from a future sale of Dick Smith by Anchorage
Key players: Partners Callen O'Brien (pictured), Riccardo Casali, John Mosley and Michael Barr David led the Minters team, together with senior legal consultant Robert Austin. National head of M&A, John Elliott, led for Clayton Utz
Deal significance: Under the agreement, Anchorage will purchase 100 per cent of the business, including 327 stores employing more than 4500 people. The transaction is expected to complete in late 2012. Woolworths CEO Grant O’Brien announced Woolworths’ intention to exit the Dick Smith business through a restructure and divestment process in January 2012. The sale follows a strategic review and restructure of the business that determined it was non-core in the size and context of the broader Woolworths retail platform and focus on shareholder value.
"This has been one of the most complex private equity transactions we have handled. Both the transaction itself and the funding structure threw up a number of challenging strategic issues that required some innovative thinking to resolve,” said O'Brien.
“With the addition of this iconic brand to its investment portfolio, Anchorage has a wonderful opportunity to again demonstrate its ability to improve the operational and financial performance of its portfolio companies.”
