Myer merges with Premier Investments’ clothing brands

Myer’s merger with Solomon Lew’s Premier Investments will significantly expand its store network and product range. This acquisition marks the largest shake-up for Myer since its return to the ASX in 2009, positioning it to broaden its customer base, especially targeting younger shoppers, and improve supplier negotiations.

Transaction snapshot

• Deal value: N/A

• Deal multiples: N/A

• Deal type: Merger

The merger will add 719 stores under Premier’s Apparel Brands, which includes well-known labels such as Jay Jays, Dotti, Just Jeans, Portmans, and Jacqui E., allowing Myer to cater to a diverse demographic from younger adults to mature shoppers. Once approved by shareholders, Lew will own approximately 27 per cent of the new, expanded Myer group, while Premier Investments will focus on its successful Peter Alexander and Smiggle brands.

The 124-year-old retailer’s growth will expand its workforce to 17,300 across Australia and New Zealand. It will also boost Myer’s annual revenue to over $4 billion, generating $250 million in earnings. Myer’s executive chairwoman Olivia Wirth, formerly with Qantas Loyalty, views this expansion as a strategic move to leverage Myer’s buying power with suppliers and landlords, and to extend the popular Myer One loyalty program across Premier’s Apparel Brands.

Wirth highlighted the potential of Myer One’s growth across new brands, with its 10.6 million members gaining points at brands like Just Jeans and Jay Jays. This expansion will allow Myer to reach a younger demographic and cross-sell other Myer categories, such as beauty and homewares, aligning with future growth goals.

The merger involves Premier shareholders receiving 890.5 million new Myer shares. Myer will issue a 2.5-cent fully franked dividend for existing shareholders, and Premier will contribute $82 million in cash for integration. Premier shareholders will control 51.5 per cent of Myer.

Lew will serve on Myer’s board alongside his associates, ensuring a strong influence in the company’s direction. Meanwhile, Premier’s board will focus on the growth of Smiggle and Peter Alexander, with expansion plans both locally and internationally.

Lew, who first supplied Myer at age 18, has been invested in the company’s success for decades. Despite previous management disputes, he continues to hold significant sway in Myer’s future.