Wesfarmers drops A$1.5b listing plan
SYDNEY: Even before Amazon sets up shop in Australia, the online giant is hurting its biggest rivals.
Wesfarmers Ltd, the supermarkets-to-hardware conglomerate that is Australia’s biggest private employer, yesterday scrapped a A$1.5 billion (RM4.80 billion) initial public offering (IPO) of its office-supplies business.
With analysts almost halving profit forecasts for some local retailers before Amazon.com Inc’s arrival, Wesfarmers could’t get the price it wanted for Officeworks.
Amazon has become Australia’s most anticipated new entrant of the Internet era. The company ended months of speculation last month when it unveiled plans to launch retail operations in Australia, appealing to small suppliers to sell their goods online alongside Amazon products.
There’s little doubt that Officeworks, which sells everything from printers and phones to paper and pens, would suffer as its products were so suitable for online purchasing, said Ric Spooner of CMC Markets, here.
Wesfarmers announced it was considering a possible IPO of Officeworks in February.
The firm said yesterday a listing “would not realise appropriate value and would not be in the best interests of its shareholders”. It blamed “current equity market conditions” and didn’t mention Amazon. Bloomberg