JB Hi-Fi has confirmed it is not in talks with Woolworths, ending speculation it was discussing a possible merger with the grocery and retail giant.
In a statement to the Australian Securities Exchange regarding the company’s recent rapid share price rise, JB Hi-Fi chief financial officer, Richard Murray, discussed possible reasons for the rise, including speculation over the potential merger.
“There are several possible reasons for the recent substantial price increase in JB’s shares,” said Murray, referring to the company’s recent record net profit announcement and positive outlook, as well as upgrades in analyst’s recommendations.
Murray went on, “JB is also aware of recent speculation in the media concerning a potential merger involving Woolworths Limited. JB is not involved in any discussions with either Woolworths or any other party concerning a potential control transaction. Nor has JB received any proposal for such a transaction from any third party”.
The comments are the first official confirmation the companies are not in discussion, following speculation in the Australian Financial Review in mid-August.
At the time, JB Hi-Fi chief executive, Richard Uechtritz, did not deny outright that talks were occurring, telling Appliance Retailer that, “We can’t comment on that”.
“Even when it’s not in the paper we get the calls – from analysts and fund managers – we can’t comment,” he said. “I’ve had a number of calls today, it [the newspaper coverage] doesn’t go unnoticed. The media should be more aware of this,” he said at the time.
“We’re an attractive company to many companies out there, we’re the sixth biggest [retail] company, bigger than David Jones, there are only two companies that able to [buy JB Hi-Fi].”