One year on, Anchorage confirms it is evaluating selling Dick Smith

Anchorage Capital Partners, owner of the Dick Smith retail chain, has confirmed that it has brought on advisors, believed to be Macquarie and Goldman Sachs, to “evaluate potential options” concerning the on-sale of the famous consumer electronics brand.

Anchorage finalised the purchase of Dick Smith from Woolworths in July 2013, around one year after the purchase was revealed. Woolworths received a total of $94 million for the sale of Dick Smith, which took around 12 months to finalise due to a monthly instalment payment plan and, sources say, complications with stock handover.

The private equity firm is already investigating selling the chain, most likely through an Initial Public Offering (IPO).

In the short space of time since the taking ownership, Dick Smith has been on a publicity drive, holding press conferences, charity events and conducting an unusually high amount of PR.

The most significant announcement made by Dick Smith has been its partnership with David Jones. In what was widely viewed as being a win-win situation for the two retailers, Dick Smith assumed control of David Jones’ electronics business, through the establishment store-in-store concepts.

A spokesperson for Anchorage referenced this when confirming the plans this afternoon.

“Dick Smith’s turnaround strategy has been implemented very successfully and the business is now pursuing organic growth options such as the David Jones Retail Brand Agreement, the launch of post-paid mobile phone plans, its new store format, opening new stores and other initiatives.

“Anchorage is a turnaround-focused investment firm, so given the business is now pursuing a growth agenda and following interest from the investment community, we have commenced working with advisors to evaluate potential options.”

Woolworths received a total of $94 million for the sale of Dick Smith, which took around 12 months to finalise due to a monthly instalment payment plan and, sources say, complications with stock handover.

Rumours that Anchorage was already planning to sell Dick Smith have been circulating ever since the purchase was finalised. In late August 2013, Abboud was asked a press conference to address this issue.

“Anchorage is very confident with the strategy that management have put into the business,” he replied. “It allows us to look at many options, and one of those would be an IPO.

“The timing of that? Obviously we need to perform for a period of time and once we can get the runs on the board, then we will allow the wider market to get involved in Dick Smith.”

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