Kirkcaldie estimates residual value of $3.18-$3.67/share after distribution, share cancellation

Tuesday 23rd February 2016

Kirkcaldie & Stains, the cashed-up former department store operator, says its residual value is expected to be $3.18-to-3.67 a share once it has completed a court-approved return of capital to shareholders and cancelled four out of every five shares on issue.

The company gave the estimate before its annual meeting today, held at the Wellington Club, and is based on estimated remaining net assets of $6.5 million to $7.5 million.

Kirkcaldie this month gained High Court approval to return about $19.4 million to shareholders via a scheme of arrangement following the sale of its name and the lease to its Lambton Quay premises to Australian department store chain David Jones. The unprofitable, upscale department store closed after 152 years and the capital return comes from the sale of its neighbouring Harbour City Centre building. Some investors have been attracted to potential value in the wash-up, including veteran corporate raider Ron Brierley, who currently holds 9.9 percent.

Kirkcaldie chairman Falcon Clouston said the residual value was dependent on the company's ability to dispose of its remaining leases for sites in Petone, Thorndon Quay and Brandon Street, sale of remaining stock and no warranty claims arising from its agreement with David Jones.

"The board is actively considering specific opportunities for each of these premises and is hopeful that satisfactory arrangements can be concluded in the coming weeks," Clouston said. A final distribution of the residual value assumes the company is put into liquidation "or another opportunity arises to realise value for shareholders."

BusinessDesk.co.nz

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