U.S. News

NZ's Warehouse Will Look to Buy or Return Cash, Eyes Coles' Assets


New Zealand's largest listed retailer and takeover target, The Warehouse Group, said on Friday it would either look to make an acquisition or return money to shareholders.

Chief Executive Ian Morrice said the company was looking at two capital management options given its low level of debt.

Morrice also told the media that the company may be interested in acquiring some of the assets of Australia-based Coles Group, saying it had the financial capacity to support such a purchase.

"It comes down to are there opportunities we have identified that we can invest our shareholders' funds in, and even borrow money to do, such as acquisition," Morrice said

"Alternatively can we return some cash to shareholders. Those are the two options."

On Friday The Warehouse reported a net profit after tax of US$41.8 million for the six months to January 28, compared with a loss of US$5.5 million in the same period a year before.

It said it was comfortable with market forecasts for a full year profit of around US$66 million. Shares in The Warehouse were trading higher late Friday morning.