In a surprising turn of events, Australian luxury department store chain David Jones is being sold by its South African owner, Woolworths. Woolworths initially purchased the business for A$2.1 billion in 2014 but is now selling it for a significantly lower price. The sale is expected to be finalized by March of next year.

David Jones is renowned for its extravagant collection of high-end European and American fashion and beauty brands, such as Alexander McQueen, Versace, and Balmain. The business will now be taken over by new owner Anchorage Partners, who will acquire 43 stores and inject fresh funds into the company. Woolworths had previously closed some stores as part of its efforts to turn the business around.

The flagship David Jones property on Bourke Street in Melbourne, however, will not be included in the sale and is projected to be sold separately next year. Despite this, David Jones is expected to remain a tenant in the property. CEO Scott Fyfe will retain his position and has the support of the new owner for his revitalization plans, known as Vision 2025+, which focuses on bolstering both physical and online sales.

While Woolworths Holdings will still retain ownership of the Country Road group of retail chains in Australia, it is exiting the department store market. The company had to write down its investment in David Jones as the turnaround process took longer than originally anticipated.

Despite facing challenges in recent years, David Jones has remained a highly desirable business. Anchorage Partners competed against Teoh Capital for the acquisition, ultimately securing the deal. It is believed that David Jones returned to profitability in 2021, marking its first year of profit since 2018.

Anchorage Partners specializes in investing in businesses that are undergoing significant transformations or are not realizing their full potential, making David Jones a perfect fit. The company has grappled with the rise of online shopping and the entry of international chains into the Australian market. The COVID-19 pandemic has further impacted its operations.

The new owner envisions tremendous prospects for David Jones. A spokesperson for Anchorage referred to the deal as a “landmark transaction” and commended the brand’s rich history, strong brand value, and valuable assets. Scott Fyfe expressed his enthusiasm for collaborating with the Anchorage team in elevating David Jones to the position of Australia’s leading omnichannel retailer and one of its most beloved brands.

Useful links:
David Jones Official Website
Anchorage Partners Official Website