Despite Kirks' seven-year run of trading losses, Nairn said he believed the planned David Jones store would be profitable.
He did not go into details when asked what brands would be in the store.
It was too early for Nairn to say if David Jones would open stores elsewhere in the country.
"We have no plans to move into Auckland, our 100 per cent focus will be building this [Wellington] store ..." Nairn said. If the Kirks' deal goes ahead, it is expected David Jones would take on its lease and open for trade during the middle of next year after a refurbishment.
David Jones is the fifth company owned by South Africa's Woolworths Holdings to move into this market, following Country Road, Witchery, Trenery and Mimco.
The group employs more than than 500 staff here.
"The end of Kirkcaldie & Stains as a much loved Wellington department store has been a very difficult decision to make, but we believe it is in the best interests of the company, the staff, our customers, and for Wellington," Kirkcaldie & Stains chairman Falcon Clouston said in announcing the deal yesterday afternoon.
"The nature of retailing has dramatically changed in the last decade. We are a single large-format store and we lack scale to be able to compete with multi-store regional and global operators that are beginning to dominate the new retail environment.
"Therefore the board has decided to recommend to shareholders that the Kirkcaldie & Stains store cease trading in late January next year, and in due course, the company will be wound up or sold, and funds returned to shareholders."
David Jones, bought by South Africa's Woolworths Holdings last year for A$2.2 billion, intends to offer employment to the majority of Kirks' staff. The Aussie retailer, which would take over the lease in the Kirks building, would pay A$400,000 cash for the distinguished Wellington brand and have the option to pay a further A$500,000 for its fixed assets.
One disgruntled shareholder was "outraged" at the price and thought the brand was worth "considerably more" than A$400,000.
"It's debatable as a shareholder I actually own that brand because it is part of New Zealand's heritage," said the investor, who did not want to named. But other investors were more than happy to give the proposed deal the green light.
Following the deal, shareholders were expected to receive distributions above the "recent market value of their shares", the company said, but the precise amount is not yet known.
After selling the Harbour City building in Lambton Quay the company has cash deposits of $18 million, with a further $4.75 million coming in October. Stock was valued at around $8.3 million. Shareholders will meet by the end of July to consider the proposal and, if it goes ahead, the Kirks store will begin windingdown.
