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Following the announcement of the Home Investment Consortium Company Pty Ltd.'s ("Home Consortium") agreement with Woolworths Limited to acquire the Masters property portfolio, Bunnings confirms that it has entered into an agreement with Home Consortium for a small number of these properties. Bunnings notes that the Home Consortium agreement with Woolworths is subject to the consent of Lowe's Companies, Inc.
There are six freehold trading locations and two freehold development sites covered by the Bunnings/Home Consortium agreement. Seven of these freehold sites are intended to replace existing older under-scoped Bunnings locations.
In relation to the six freehold trading locations, Bunnings will enter into new leases directly with Home Consortium. Work to reformat these locations is expected to take up to five months from the date of completion, at which time the stores will then open as Bunnings Warehouses. The freehold development sites require a normal development planning and approval process before a Bunnings Warehouse could then be constructed and opened. If all approvals are successfully obtained, Bunnings will enter into new leases directly with Home Consortium for these two sites.
In addition to the freehold locations, Bunnings and Home Consortium have agreed to jointly engage with the landlords of seven leased trading locations to establish new leasehold arrangements and to reformat these sites into Bunnings Warehouses. Four of these sites will potentially replace existing older under-scoped Bunnings locations.
Assuming the above-mentioned consent is obtained, the transaction between Home Consortium and Bunnings will provide Bunnings with 15 new sites comprising six freehold trading locations (to be leased from Home Consortium), two freehold development sites (to be leased from Home Consortium) and seven leasehold trading locations. Eleven of the 15 sites will be replacement stores and four will be new locations.
Commenting on the announcement, Bunnings CEO, John Gillam said: "Consistent with what we have said publicly since February, we identified specific sites of interest if the Masters home improvement business was closed. The 15 sites covered by this agreement is a small proportion of the overall 97 locations that were offered, and they are of high quality and a good fit with our existing store portfolio and pipeline. Eleven of the 15 locations will be replacement stores and provide us with a great opportunity to improve our offer in these areas. We're also pleased to have the opportunity to bring the Bunnings offer to four new locations."
There are six freehold trading locations and two freehold development sites covered by the Bunnings/Home Consortium agreement. Seven of these freehold sites are intended to replace existing older under-scoped Bunnings locations.
In relation to the six freehold trading locations, Bunnings will enter into new leases directly with Home Consortium. Work to reformat these locations is expected to take up to five months from the date of completion, at which time the stores will then open as Bunnings Warehouses. The freehold development sites require a normal development planning and approval process before a Bunnings Warehouse could then be constructed and opened. If all approvals are successfully obtained, Bunnings will enter into new leases directly with Home Consortium for these two sites.
In addition to the freehold locations, Bunnings and Home Consortium have agreed to jointly engage with the landlords of seven leased trading locations to establish new leasehold arrangements and to reformat these sites into Bunnings Warehouses. Four of these sites will potentially replace existing older under-scoped Bunnings locations.
Assuming the above-mentioned consent is obtained, the transaction between Home Consortium and Bunnings will provide Bunnings with 15 new sites comprising six freehold trading locations (to be leased from Home Consortium), two freehold development sites (to be leased from Home Consortium) and seven leasehold trading locations. Eleven of the 15 sites will be replacement stores and four will be new locations.
Commenting on the announcement, Bunnings CEO, John Gillam said: "Consistent with what we have said publicly since February, we identified specific sites of interest if the Masters home improvement business was closed. The 15 sites covered by this agreement is a small proportion of the overall 97 locations that were offered, and they are of high quality and a good fit with our existing store portfolio and pipeline. Eleven of the 15 locations will be replacement stores and provide us with a great opportunity to improve our offer in these areas. We're also pleased to have the opportunity to bring the Bunnings offer to four new locations."
