Premier Investments sells apparel brands for Myer shares

Premier Investments (ASX:PMV) has announced a significant strategic transaction involving the sale of its Apparel Brands business to Myer Holdings Limited. The transaction will result in Premier receiving 890.5 million new shares in Myer, equating to a 51.5% stake in the enlarged Myer share base. This move allows Premier to focus more on expanding its Peter Alexander and Smiggle brands.

Transaction summary and strategic outlook

Premier Investments' strategic transaction involves the sale of its Apparel Brands, including Just Jeans, Jay Jays, Portmans, Dotti, and Jacqui E, to Myer Holdings. In return, Premier will receive a 51.5% stake in Myer through new shares. The plan is to distribute these shares to Premier's shareholders, making them direct shareholders in Myer. This shift will allow Premier to focus on growing the Peter Alexander and Smiggle brands, with expansion plans including new flagship stores and entry into the UK market. The transaction is expected to create a leading fashion retailer in Australia and New Zealand, with anticipated synergies and operational efficiencies. It is subject to regulatory and shareholder approvals, with completion expected in early 2025.

Executive commentary on Premier's strategic transaction

The combination of Myer and Apparel Brands aims to create a leading integrated fashion retailer in Australia and New Zealand. Expected benefits include enhanced scale, improved customer loyalty programs, and better operational efficiencies. Myer anticipates at least $30 million in annual earnings synergies over the short to medium term.