WELLINGTON - Coles Myer is in talks to sell its loss-making Katies clothes stores, according to reports in Australia.
But Coles Myer media relations manager Lisa Amor dismissed the articles yesterday.
"There's nothing to report on our Katies stores," she said. "It's just rumour and speculation."
The Sydney Morning Herald said the Coles
board this month had discussed four bids for Katies.
In New Zealand, any change in the ownership of 26 Katies stores would be a further shakeup for the women's apparel scene. Late last year, 19 Sportsgirl and Sportscraft stores closed.
In Australia, rival clothing chain Sussan bought 104 Sportsgirl stores but the deal did not include any outlets in New Zealand, where about 80 mainly part-time staff lost their jobs.
The Katies talk comes amid speculation that Coles is also considering pulling the plug on its loss-making, 11-store Kmart operations in New Zealand.
One report said The Warehouse had held broad discussions with Kmart about taking over some of its property leases.
The report said suggestions have been made that Coles sought, but failed, to find a new owner for Kmart in New Zealand.
The Warehouse bought the store lease when Kmart moved out of Wanganui last year, sparking rumours that The Warehouse might replicate the deal in other centres.
Commenting on the reports, Kmart general manager in New Zealand Craig McKeown said they were pure speculation.
He said there had been broad discussions with The Warehouse, but not this year.
In Australia, it was claimed four parties submitted bids for Katies, including the Packer-backed Pretty Girl (which recently bought Woolworths' apparel chain, Rockmans), Peter Lew (son of Coles Myer's largest individual shareholder and board member, Solomon Lew) and one of Australia's most successful clothes retailers, Miller's.
UBS Warburg was reported to have been brought in as adviser.
One suggestion is that tension in the boardroom at Coles could see the whole conglomerate split up, although the pressure was abating under new chief executive Dennis Eck who at last seemed to be getting Coles' act together.
Katies sales dropped by $A39 million ($50 million), or 30 per cent, for the half year ended January 23, 2000.
Coles' apparel and home division, which includes Katies, Kmart and Target, reported a 6.1 per cent fall in sales in the third quarter of its financial year. Sales were down 3 per cent for the first three quarters.
- NZPA
