Woolworths sells 5 per cent Stake in Endeavour Group for $468m

Woolworths has announced the sale of a 5 per cent stake in Endeavour Group, the owner of Dan Murphy's and BWS, for $468 million. The sale was made via a block trade at $5.22 per share, reducing Woolworths' shareholding in Endeavour to approximately 4.1 per cent.

Transaction snapshot

  • Deal value: $468 million
  • Deal multiples: N/A
  • Deal type: Block trade
  • Investors: N/A

Woolworths has agreed not to sell any more shares for at least 60 days and intends to use the proceeds to return capital to shareholders. An update on this will be provided at the group's full-year results in August.

Brad Banducci, Woolworths' outgoing CEO, stated that a material equity investment in Endeavour was no longer necessary as the pubs and liquor chain owner approaches its three-year anniversary as an independent listed company. Woolworths currently has no intention to sell its remaining stake but will continue to assess what is in the best interests of its shareholders.

UBS analyst Shaun Cousins noted that Woolworths has $760 million in franking credits and may consider a special dividend or on-market buyback.

Endeavour, which was spun out of Woolworths in June 2021, will continue its relationship with Woolworths and their existing partnership agreements. Upon floating, Woolworths retained a 14.6 per cent stake in Endeavour.

The sale follows a public dispute last year between Endeavour and its other major shareholder, billionaire publican Bruce Mathieson, who unsuccessfully attempted to appoint former Woolworths executive Bill Wavish to the Endeavour board. Former Endeavour chairman Peter Hearl and Mathieson's son, who was a director, resigned in January as part of a broad reshuffle. Ari Mervis, the former CEO of Murray Goulburn, is now the chairman of Endeavour.

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