Woolworths to sell 5pc of its holding of Dan Murphy’s, BWS owner Endeavour and return capital to shareholders

Adrian Lowe
The Nightly
2 Min Read
The sale of Endeavour shares in a block at $5.22 a share is set to raise Woolworths $468 million.
The sale of Endeavour shares in a block at $5.22 a share is set to raise Woolworths $468 million. Credit: Ross Swanborough/The West Australian

Retailer Woolworths will sell some of its remaining stake in liquor group Endeavour, the owner of Dan Murphy’s, BWS and hotels group ALH.

Endeavour was a spin-out of Woolworths’ liquor division, listed on the ASX in June 2021.

Woolworths on Wednesday said it would sell 5 per cent of its holding, leaving it with 4.1 per cent. Based on Endeavour’s 2023 annual report, this would still leave Woolworths as its fifth-biggest shareholder.

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The sale of Endeavour shares in a block at $5.22 a share is set to raise Woolworths $468 million. Woolworths has committed to retaining its remaining shares for at least 60 days.

“While Woolworths Group and Endeavour Group remain important business partners, with a number of long-term partnership agreements in place, we no longer believe that a material equity investment in Endeavour is required as Endeavour approaches its three-year anniversary as an independent listed company,” Woolworths chief executive Brad Banducci said.

“As a result, we have decided to reduce our stake below 5 per cent with the intention to use the proceeds to return capital to shareholders.

“We currently have no intention to sell the remaining stake but will continue to assess what we believe is in the best interests of Woolworths Group shareholders.”

UBS analyst Shaun Cousins noted Woolworths also had $760 million in franking credits from the first half of the 2024 financial year so it may consider a special dividend to shareholders or an on-market buyback.

Endeavour in a brief statement acknowledged the Woolworths selldown, and said its partnership agreements would continue.

Endeavour shares closed down 3.9 per cent to $5.15 and Woolworths was down marginally to $31.82.

Woolworths and Endeavour outlets are frequently co-located so share services such as cleaning and maintenance and in some cases other supply, such as shared products like soft drinks and packaged snacks.

Woolworths will report its third quarter sales results on Thursday and Endeavour reports its on Monday. Woolworths is also expected to provide an update on the proceeds of the Endeavour share sale at its full-year results announcement, scheduled for August.

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